In an era of telecommunications deregulation, the Spanish government has chosen to issue Telefonica de Espana SA with a new monopoly charter covering virtually all telephone services for the next 30 years. The monopoly covers local and international phone services, portable phones, facsimile services and viewdata. Legislation that is evolving in both Spain and in the Commission of European Communities could lend itself to a delay in the perpetuation of Telefonica’s monopoly, however, and without financial compensation to the Spanish phone company. Tim Stevens, director of research for International Data Corp in Paris, says the move was a gesture of confidence in Telefonica, given the huge modernisation programme and service improvements it has provided in the last couple of years. Whether this monopoly will last 30 years, however, is questionable, given European Commission regulations, he says. One such piece of legislation could be the Commission’s proposal to apply the Open Network Provision to the leasing of lines in Europe. A Yankee Group Europe report, on the leased line Open Network Provision proposal, said the move was the Commission’s first priority, because access to leased lines was the most important requirement for third party service providers. Leased circuits are also clearly defined as part of the monopoly, the report said, leaving little argument about the need to apply the Open Network Provision in this area. The Provision draft states, among other things that the principle of non-discrimination in supply, applies to availability of technical access, quality of service, delivery time, repair time and availability of network information; calls for adequate regulatory safeguards to be implemented nationally to ensure that owners of the network cannot discriminate against competitors. In October, a spokesman for the telecommunications networks access division of the Commission said that the Dutch president was pushing to have a common position between the plenary of the Parliament and the Council of Ministers on the leased line Open Network Provision by end of this year. That done, its final adoption, he said, could be completed by early spring at best, and at worst, late summer. International Data Corp’s Stevens is sceptical that the European Commission will be in a position any time soon to use such legislation to prosecute monopolist PTTs, given the problems over reaching agreement on the next phase of European unification. Factors that potentially work in favour of Telefonica’s continued status as a monopoly, Stevens notes, include the fact that it has bilateral agreements with other European carriers, such as the Deutsche Bundespost Telecom and CPRN Marconi in Portugal, and that it is a participant in major European Commission research programmes such as Race and Esprit. You can’t say they aren’t outward-looking, he says.
