Most Czechs profiting from discount telecoms tariffs says watchdog

Around seven out of 10 Czechs are getting discounted rates for Internet mobile phone use compared to than those being officially offered by the main providers, according to the business daily Hospodářské Noviny. The article puts a broad figure for the first time on the discounts whose extent had previously not been mapped or made public.

Photo: Barbora Němcová

The extent of the uptake of those offers has been released by the Czech competition watchdog, the Office for the Protection of Competition. And those facts appear to reinforce the office’s broad finding’s that the three biggest Czech telecoms operators, Vodafone, T-Mobile, and O2, have not been abusing their dominant position on the domestic market.

Suspicions of such collusion and cartel behaviour were fuelled by the companies official price list for services which showed a surprising convergence around the 749 crowns a month basic offer for users. The competition office interprets the fact that the preponderance of reduced tariffs and their increasing uptake as well as users ability to negotiate even better rates is effective proof that a real market does exist.

Reduced and improved rates are often offered by operators when users’ existing agreements are coming to a close or as an up front offer to draw in new clients and get them to transfer from rivals.

Some of those discounts are also a spin off of employees being offered special rates as a result of the discount telecom packages that all the big telecom players are offering corporate customers.

Czech telecom operators at the start of the year came under intense government pressure over their charges. Particular attention was given to the high costs of data transmission and the not very transparent cross subsidies which were admitted to be in force on the market.

Since then, the competition office argues that some changes improving the situation for consumers have taken effect. On the data market, though Czech still appear to be paying a lot more than users in many richer West European markets.

The competition office and the specific telecoms regulator, the Czech Telecommunication Office, are both reported to still believe that the big telecoms companies still have room to lower their charges on the so-called wholesale market. That’s the market where they sell on capacity on their main and local networks to alternative operators and the market conditions there are often crucial for sparking competition on smaller specific parts of the telecom market.