Belgian watchdog puts the brakes on Orange and Proximus JV

The proposed network sharing joint venture between Orange and Proximus has been slowed as the Belgian Competition Authority (BCA) launches an investigation.

At the request of Telenor and Telenet, the Belgian authorities have placed temporary measures on Orange and Proximus to halt a network sharing joint venture while it investigates the potential impact on competition in the market. The original agreement was between the two parties was concluded in November and will remain stagnant until at least March 16.

Both Orange and Proximus have noted the complaint but rejected the basis of the opposition from Telenet.

“The sharing agreement for the mobile access network will have positive effects for the customers and for the Belgian society as a whole, in particular a faster and more extensive deployment of 5G, a significant reduction in total energy consumption and an improvement of the global mobile service experience, while maintaining a strong differentiation between the parties on services and customer experience,” the pair said in a joint statement.

As part of the joint venture, the pair have said the rollout of a joint radio access network would allow the number of mobile sites to be 20% higher compared to each operator’s current stand-alone radio access network. This improved coverage is claimed to increase the footprint to more than 10,000 households across the country.

Each party would retain full control over their own spectrum assets and operate their core networks independently to drive differentiation. The network sharing agreement would span across 2G, 3G, 4G and 5G.

While this does sound positive for the consumers of Belgium, a complaint from the third-largest operator should not be a monumental surprise.

Telco Subscriptions Market share
Orange 4,895,631 35%
Proximus 6,310,403 45.1%
Telenet 2,801,759 19.9%

Statistics curtesy of Ovum World Information Series (WIS)

Telenet’s has suggested the joint-venture would create a quasi-monopoly, as the number of infrastructure players in the market would be reduced from three to two. The telco also suggests BEREC guidelines would prevent such a joint-venture from materialising as it would undermine intense infrastructure competition.

Telenet is also pointing towards a similar agreement in the Czech Republic between O2 and T-Mobile. Despite this agreement was far less wide-ranging (it did not span across 2G, 3G, 4G or 5G), the European Commission opposed the tie-up with the suspicion it would have a detrimental impact on competition in the country.

With the drive towards 5G and full-fibre broadband straining CAPEX budgets throughout the industry, the impact is perhaps felt more in countries such as Belgium where populations prevent scale. Network sharing agreements are not uncommon as a means to more efficiently invest, though these are usually focused on specific geographies or limited to 5G expenditure. Other initiatives are usually in countries where the base-level of competition is higher than what is currently in play in Belgium.

While this investigation is underway, Orange and Proximus are able to begin the groundwork for the joint-venture, sending out RFPs (Request for Proposal) or select staff to be transferred for example, though Telenet has presented an interesting case. European regulators are incredibly sensitive to competition, especially in markets where there are only three telcos.

Liberty Global makes another big European R&D investment

The Telenet Innovation Center in Brussels joins and equivalent R&D hub in Amsterdam as Liberty Global tries to get ahead of emerging tech trends.

Belgian operator Telenet is owned by Liberty Global and has b identified by its parent company as a good place to mull over the challenges and opportunities presented by emerging tech megatrends such as 5G and IoT. It joins Liberty Global’s Tech Campus near Amsterdam and the two will also investigate other tech opportunities for the group.

“The opening of the Telenet Innovation Center is an important milestone for Liberty Global,” said Balan Nair, Liberty Global Chief Technology and Innovation Officer. “The cutting-edge infrastructure and Telenet’s fully owned mobile network provide the perfect conditions for us to test the products and services that can pave the way towards the GIGAWorld. I’m already excited about the opportunities and inspiration that await us.”

“With the Telenet Innovation Center, we want to be ambitious and bring our own innovations to a higher level, but also help shape external innovation projects,” said John Porter, CEO of Telenet. “I believe in the absolute strength of partnerships, so I am convinced that with our model of collaborative innovation and with the help of partners like ZTE, we can bring the best broadband and media technology to Belgium for thorough testing, experimentation and successful launch in our market.”

Paolo Pescatore of CCS Insight popped over for the grand opening. “For Liberty Global, this is a huge investment,” he said. “It shows a strong commitment to grow its presence in the rapidly changing and converging European landscape.

“Consumers’ insatiable appetite for connectivity and content is showing no signs of easing up. Cable and telecom providers’ are under huge pressure to stay at the forefront of innovation. They need to move at lightning speed as online giants are pushing boundaries even further. The increasing demand for IoT solutions and the arrival of 5G, opens up a wealth of opportunities and it is important that the networks are equipped to deal with the explosion of data traffic and to serve the emergence of new use cases.”

Among the stuff showcased on the day was a special demo room for ZTE, which as we heard is a close partner of Telenet. There was also the good old AI robot, which as you can see from Pescatore’s tweet below, managed to get a crucial question right.