The BIPT sits on the fence as to whether a fourth operator would be a good thing – and crucially notes there is currently no interest from would-be new entrants
No immediate competition concerns: Upon request of the Belgian Government, the national regulator, the BIPT issued an update on its study on the impact of the entry of a fourth mobile operator in the Belgian mobile market, originally published in June 2018. In several respects, the new study reaches conclusions similar to those of the 2018 one. It finds that the Belgian mobile market is not characterised by major competitive problems which require ex-ante intervention – MVNOs can obtain access through commercial negotiation – however competition could indeed be strengthened.
A fourth MNO could mean lower prices, but probably less investment: Retail prices have been on a downward trend, although they remain comparatively high in Europe, especially for large data plans. Quality of service is deemed to be very good, although mobile broadband adoption remains far lower than the European average. The entry of a fourth operator in the market would likely cause a sharp drop in prices, especially in the short term, as observed in France, the Netherlands, and Italy. However, the longer-term impact is less clear, especially on investment where there is some evidence that lower profits become a constraint. On the one hand, more competition is an incentive to innovate, and there have been cases of accelerated deployment of 4G due to the entry of a fourth operator (e.g. the Netherlands). On the other, operators may invest less in rural areas, or reduce their spend on quality.
Building the network would be a challenge: The BIPT does not take a conclusive view on whether the entry of a fourth operator in the market is a desirable outcome, but notes that network deployment could be a barrier to entry due to the fact that most sites are already occupied by the existing MNOs, and that obtaining permits to build new towers is likely to be a lengthy process. This would likely result in the new entrant seeking network sharing agreements with the existing operators, and would potentially require regulatory intervention to reserve frequencies to the new entrant, mandate national roaming obligations, and make sure the new MNO faces a less demanding timetable to meet coverage obligations. Crucially, the BIPT notes that the entry of a fourth player must be a choice of the market, and that for the time being no interest has been shown by potential entrants.
