By accepting a voluntary commitment from KPN the regulator hopes to avoid future legal challenges, but access seekers aren’t thrilled
Bringing back some oversight of an unregulated market: The Dutch regulator, the ACM, could accept a commitment from KPN to improve access conditions to its fibre network and to that of Glaspoort, a fibre joint-venture created in 2021 between KPN and the pension fund APG. KPN presented its commitments just weeks before the ACM was expected to propose new regulation for wholesale broadband access. This market is currently unregulated in the Netherlands, since a tribunal annulled the 2019 review in which the ACM had designated KPN and VodafoneZiggo to have joint SMP. Since then, VodafoneZiggo stopped providing wholesale access, whereas KPN continued to do so on unregulated terms. In 2021, the ACM identified risks of reduced competition and of consumer detriment due to the worsening of access conditions to KPN’s network, and launched a new review.
KPN commits to significant discounts for access to its fibre network: KPN has committed to offer unbundled access to its point-to-point FTTH network across the country for €16.56 per line. This is more than 10% lower than the current price of €18.56. KPN would also lower its VULA prices, depending on the type of products and speeds selected by wholesale customers. In particular, the monthly price for 100Mbps VULA would be reduced by 20%, and the 1Gbps VULA product would fall by 50%. Glaspoort also commits to lowering its VULA tariffs, which are currently higher than KPN (approximately €2.50 per month higher), as a result of higher rollout costs in small towns and sparsely populated areas. KPN and Glaspoort’s commitments would be valid for eight years, with a right to adjust prices based on CPI up to a maximum of 2%. If inflation in a given year is higher than 4%, the two operators can add the percentage points above the 4% threshold.
Access seekers are not thrilled: The ACM is submitting the deal to public consultation until 27 May before making a final decision. The regulator estimates that KPN’s commitments will lead to more competition on price and speeds, and generate savings of up to €200m per year for Dutch households. Given the recent history of repeated defeats in court, the ACM’s preference for a deal with KPN is understandable, but the regulator should expect a lukewarm response from some stakeholders. T-Mobile has already criticised the agreement, saying it would leave access to KPN’s network at least 25% more expensive than with other providers it uses where KPN is not active. T-Mobile finds it significant that KPN has room for a voluntary 50% discount on some products, and is concerned that locking the market for eight years would only benefit KPN. T-Mobile and other access seekers are also concerned that the ACM’s dispute resolution powers may not be as effective in the absence of clear non-discrimination obligations for KPN.
