The Branch Association of Bulgarian Telecommunications Operators (BABTO), of which Neterra is a member, supports a proposal to amend the Electronic Communications Act, which will improve competition in the mobile services market and provide conditions for the creation of virtual mobile operators (MVNO) in Bulgaria.
A process of transposing the European Electronic Communications Code into Bulgarian legislation is currently underway. The Code encourages the development of competition and the shared use of infrastructure and resources.
BABTO supports the proposal according to which the Communications Regulation Commission (CRC) will set an obligation for existing mobile operators to share mobile networks with other communications operators that do not own mobile networks.
The CRC will determine technical and commercial conditions, including prices, approved in advance by the regulator, in compliance with the principles of transparency and equity, fair trade negotiations, and mutually beneficial technical and commercial conditions.
BABTO believes that this proposal is among the key to transposing the Code. It corresponds to the good European practices and will create new opportunities for all alternative operators in Bulgaria.
In recent years, many international and Bulgarian organizations, including Neterra, have tried unsuccessfully to negotiate with mobile operators in Bulgaria to obtain MVNO access to their networks.
For comparison - MVNOs have been operating on the European market for almost two decades. Globally, today they are more than 1300. Bulgaria lags far behind these trends and is the only country in Europe without virtual mobile operators.
For example, in 2020 in the UK MVNOs have a 15.9% share of the total mobile market, in Germany - 19.5%, in Spain - 11.5%, in France - 11.2%. In all these countries, incl. neighboring northern Macedonia and Romania, alternative operators benefit from a strongly supportive legal framework and actions by local regulators in the direction of opening the markets and develop competition.
European context
The European Commission (EC) estimates that € 500 billion will need to be invested over the next decade to deploy the networks needed to meet the 2025 connectivity targets. However, reports indicate that there is a risk for these investments not to be realized on time.
In this sense, the EC encourages co-investment. For this purpose, the EC adopted principles in the Code that guarantee both the shared use of the radio frequency spectrum and the promotion of access to networks.
Operators with significant market power are required to comply with strict access requirements under the control of national regulatory authorities.
European regulators explicitly recognize the importance of MVNOs for the development of competition in the retail market. They ensure that wholesale access is provided under certain conditions.
In the Czech Republic, for example, in 2019 the regulator ČTÚ included in the tender documentation for the allocation of a radio frequency spectrum in the 700 MHz band (for the provision of 5G services) the obligation for wholesale MVNO access as a condition for issuing licenses.
In Austria in 2012, at the merger between Hutchison 3G Austria and Orange Austria, the regulator obliged the new company to offer 30% of its network capacity to MVNO over the next ten years through wholesale transactions.
There are many more examples from Europe and the world of how the imposition of a wholesale access obligation is used as a measure to promote competition in the mobile market.
BABTO believes that the Bulgarian legislator will assess the importance of alternative providers of mobile services for strengthening competition and will adopt amendments to the Electronic Communications Act to allow a market opening for them. Only in this way can business help Bulgaria catch up in this area.
You can learn more on the topic of MVNO from an interview with Neterra manager Neven Dilkov.