Jazztel wholesale in-building fibre access rates to equal Telefonica’s

31 Oct 2014

Spanish telecoms regulator the National Commission on Markets and Competition (CNMC) has ordered broadband provider Jazztel Telecom to charge rival altnet Vodafone Spain the same wholesale rates as those levied by former monopoly Telefonica for access to ‘vertical infrastructure’ (network sections within buildings). Jazztel, with 11.7% of the country’s retail fixed broadband subscriber market share at June 2014 in comparison to Telefonica’s 46.2%, had asked Vodafone to pay a 50% surcharge on Telefonica’s rates to access its fibre-based vertical infrastructure due to ‘lower economies of scale and a higher cost of capital’, but the CNMC has rejected this, stating the prices set for Telefonica and now Jazztel are enough ‘to recover both the cost of capital and the risk of premium associated with the deployment of next generation networks’. The regulator has similarly rejected a request from Jazztel to add a clause to its agreement with Vodafone prohibiting the latter from re-selling ‘wholesale services provided over its optical fibre lengths in buildings’, claiming it to be ‘contrary to the telecommunications regulations’.

Jazztel and Telefonica signed an agreement in October 2012 for joint deployment of fibre-to-the-home (FTTH) networks to 1.5 million premises each. The CNMC has now ended a price dispute (involving a rival joint fibre venture launched by Vodafone and Orange Spain) by setting Jazztel’s wholesale rates to the same as those the regulator set for Telefonica in June 2014.