In the latest attempt to break Telefónica’s stranglehold on the Spanish fixed line market, regulator CMT has proposed a new telecoms law which will remove all licence requirements for operators, allowing any company to start providing services. The law has been approved by Spanish ministers although it is still awaiting authorization from the government-controlled parliament, expected next month. Under the terms of the law, operators wishing to launch services will simply have to inform the CMT before starting operations.
Telefónica was first mandated to open up its local exchanges to competitors in January 2001, although this did not actually materialise until October that year, when its competitors Retevisión, Uni2, Jazztel and business service provider Comunitel were allowed access to its local infrastructure. By the end of 2001 Telefónica had only managed to open up 27 exchanges and unbundle 600,000 of its 21.1 million lines and, following a series of complaints from rival operators, in March 2002 the CMT began investigating claims that the dominant operator was not supplying callers with prefix numbers to allow them to select an alternative carrier. The following month the regulator ordered the telco to reduce the fees it charges other operators for access to the local loop. In May 2002 the matter came to a head when Retevisión, Jazztel, Uni2 and Ono appealed to the CMT to clamp down on Telefónica’s dominance in the broadband sector, claiming that unless drastic action was taken, the broadband sector could end up as a ‘Telefónica monopoly with the rest as resellers’.