TRA initiates market review exercise, invites comments on MDD report

Muscat: The Telecommunications Regulatory Authority (TRA) has invited comments from telecom licensees, other stakeholders and the public in general on the preliminary findings in its draft Market Definition and Dominance (MDD) Report 2020.
The consultation document is open for all stakeholders and public until September 20, 2020 for their comments after which the TRA will issue its decision on the matter.
The TRA, which is responsible to prepare suitable conditions for competition among telecom licensees under the Telecom Regulatory Act 2002, recently initiated its second review of the telecommunications markets. The first market review was conducted by the TRA in 2013 under its ex-ante regulations issued in 2012.
Since 2013, many significant developments took place in the sector such as entry of Oman Broadband Company, Awasr, Oman Tower Company and the forthcoming entry of third mobile operator. Similarly, the market witnessed growth in the deployment of fiber, LTE and fixed 5G services whereas 5G mobile services are also in the pipeline. From consumers’ side, demand for data services, bundled plans and OTT services are on the rise.
Taking into consideration recent and expected future developments in the telecom sector, the TRA has completed its assessment of the markets and set out the preliminary findings in the draft MDD Report 2020. The draft MDD Report 2020 analyses all retail and wholesale markets, reviews the definition of markets, assesses their competition status in order to determine the list of relevant markets and the ex-ante obligations that dominant service providers in those relevant markets are subject to.
As per TRA’s preliminary assessment, Omantel still holds the dominant position in retail fixed telephony market and will be subject to obligations of tariff approvals, accounting separation, non-discrimination and publication of information. Ooredoo which was found to be dominant in retail broadband market in 2013, along with Omantel, is no longer found to be dominant as per TRA’s preliminary assessment and only Omantel will be subject to dominance obligations similar to retail fixed telephony. In retail mobile market, both Omantel and Ooredoo are still found to be jointly dominant as per TRA’s preliminary assessment, however considering the entry of third mobile network operator the TRA will reassess this market after 2 years of launch of commercial services by third mobile operator.
In retail domestic and international business connectivity markets (comprising of leased lines, Ethernet and MPLS services to corporate users), Omantel has maintained its dominant position since 2013 and will be subject to accounting separation and publication of information obligations. Considering that the services in these markets play an important role in business communications services and are used to support a wide variety of applications, both in the private and public sectors, the TRA noted that prices of connectivity services are high in Oman as compared with other regional countries with no material change witnessed since the last market review. The TRA therefore proposed the obligation of price caps instead of tariff approval so that prices of these services are gradually rationalized.
In wholesale markets, both Omantel and Oman Broadband Company are found to be dominant in their respective networks as per TRA’s preliminary assessment. Similar to retail broadband market, Ooredoo which was found to be jointly dominant in wholesale broadband access market in 2013 with Omantel, will no longer be dominant as per TRA’s preliminary assessment and only Omantel will be subject to obligations of supply of service, publication of reference offer, wholesale price control, accounting separation etc. In markets of wholesale termination and trunk segments as well as international connectivity services, Omantel is found to be singly dominant as per TRA’s preliminary assessment.
Besides the above issues, the consultation document also invites views from stakeholders on offering discounts from service providers to retain an existing customer or attract a new customer and offering bespoke and ‘below the line’ offers to specific customer groups (such as corporates, students, government employees) which may cause competition concerns. Considering recent trend in offering long-term contracts with users and to address potential concerns of users, the TRA seeks views on setting maximum contract length and to require no-contract option for every retail tariff plan that has a minimum contract length along with the level of early termination fee.