Why are Czechs paying most in EU for mobile data?
According to an analysis of the mobile data market published by the Czech Telecommunications Authority, retail prices for mobile data in Czechia are the highest in the EU. Czechs pay 150 percent more for mobile services than the EU average.
The mobile services market in Czechia is dominated by three main network providers – O2, T-Mobile and Vodafone – who take 96.4 percent of the market share. This lack of competition is the main reason why retail prices of mobile services in Czechia are the highest in the EU, according to an analysis by the Czech Telecommunications Authority, a regulatory body for the telecommunications sector. The report states that one gigabyte of data in Czechia is 201 percent more expensive than the EU average, and mobile services overall are 150 percent more expensive.
According to a previous statement by the Ministry of Industry and Trade, the price of mobile data in Czechia has seen a tenfold reduction since 2011. Yet it still remains the highest in the EU. "Even if there is a certain decrease in retail prices in the medium term, prices in other EU countries are falling faster than here,” the authority states in its report. This is a problem to which Hana Továrková, chairwoman of the body’s council, sees regulation as the solution.
“The CTA aims to introduce price regulation in order to create space for more development of virtual operators. Price regulation would significantly affect wholesale prices, which would in turn influence the retail prices, which are still unfortunately the highest in Europe.”
The Czech Telecommunications Authority wants to regulate the market by setting price caps and imposing an obligation on the main network providers to allow access to their wholesale mobile services to virtual operators at a regulated price. A regulated wholesale price would allow virtual operators to replicate the offers of mobile network operators and compete with them, says Ms. Továrková.
At the moment, smaller virtual mobile operators have to rent infrastructure from the big network providers, while controlling only a fraction of the market. Despite there being 125 virtual operators in the country, their share is only 3.6 percent.
This analysis by the Telecommunications Authority comes in an updated form, after the European Commission rejected three previous proposals to regulate the Czech mobile data wholesale market. The EC stated as the reason for their rejection that the analyses did not prove that the three network mobile operators were acting in concert to restrict competition. However, the EC does recognize that there is a problem, says Ms. Továrková.
“For us it’s very important, if we are speaking about more digitalization, to have an opportunity to have the wholesale prices and the retail prices on the right level, not to be too expensive. The problem remains that the European Commission right now is still thinking about how to solve the problem, not only in our country, but in other countries which have very high prices.”
This updated analysis aims to take into consideration the EC’s comments and respond to their objections. Mobile phone operators have until 19 September to comment on the analysis.