External study on the evolution of the competition dynamics of tower and access infrastructure companies not directly providing retail services

In this study, WIK Consult provides an overview of recent developments regarding infrastructure companies and explore the motivation for their creation, impact on competition and investment and implications for regulation.

The largest European mobile operators in recent years have divested or separated their tower infrastructure, with a view to value creation, unlocking capital and/or achieving efficiencies. Some larger broadband providers including incumbents have also created fibre netco JVs to access finance and/or address gaps in fibre coverage.

Sharing physical infrastructure, in theory, should support competition in networks and services and boost the business case for VHCN deployment by reducing costs. However, infrastructure sharing, in areas where duplication is viable, can also limit incentives to compete on coverage and quality (and may thus be restricted under competition law), while concerns can also arise around wholesale access terms to infrastructure (price and in some case discrimination) where there are limited alternatives available.

Extending the BCRD and EECC RoW provisions to cover towercos could improve deployment conditions for towercos, as well as ensuring consistency in application of the rules and providing a means to address any concerns about access conditions. SMP regulation / commitments or, in certain cases, symmetric rules should be appropriate to address any competition concerns relating to fibre netcos, but will likely require more granular geographic market analysis to address market power in specific areas and attention to consistency between access regulation applied under different legal bases.