The Telecommunications Regulatory Authority (TRA) has released for consultation its draft decision in relation to its review of competition in the retail and wholesale markets for broadband services in Bahrain.
However, TRA has concluded that in relation to higher-quality business broadband services, Batelco is still likely to have SMP at the retail level and dominance at the wholesale level. TRA is therefore proposing to retain regulatory obligations on Batelco in order to promote the competitive supply of business broadband services in Bahrain.
TRA last reviewed these markets in 2008 and 2009, when it found Batelco to dominate the broadband markets. Since then, there have been a number of important market developments which have led to sustainable competitive alternatives emerging for “mass-market” broadband consumers, who are predominantly residential and small business consumers. These consumers now have a range of suppliers available, including DSL, fixed wireless (i.e. WiMax), and mobile broadband operators. As a result, Batelco’s market share has fallen substantially, from in excess of 90% of subscribers in 2008 to less than 30% in 2012.
For higher-quality business broadband services, however, there appears to be less competitive pressure, as competing wireless operators have not been as successful in this segment. Competitors relying on regulated access to Batelco’s fixed network remain an important source of competition for business broadband services.
TRA’s preliminary finding that Batelco no longer has SMP or dominance in the supply of mass-market broadband services is an important step in ensuring that the regulatory framework in Bahrain is reviewed and adapted in light of competitive developments. TRA’s decisions to issue new National Fixed Wireless Service licences in 2007 and a third Mobile Licence in 2009 have facilitated new infrastructure-based entry into Bahrain with the arrival of Menatelecom and Viva. Both of these operators have been important competitors in the supply of broadband services, and the draft determination issued today reflects this.
At the same time, TRA’s analysis recognizes that regulation at both the retail and wholesale level continues to have a role to play in promoting competition in the business broadband markets.
“The draft determination released today is an important decision as it ensures that regulation in Bahrain remains targeted only in those areas where there is a lack of competition,” TRA’s General Director Mohamed Bubashait, said.
“In proposing to remove regulatory obligations in relation to mass-market broadband services, we are recognizing that vigorous and sustainable competition has emerged which does not rely on regulated access. In recent years, we have seen a dramatic increase in the number of WiMax and mobile broadband services in Bahrain. In such circumstances, regulation is not required, as consumers are able to benefit from lower prices, innovative services, and higher quality as a result of competition between the network operators in Bahrain.”
TRA is inviting interested parties to submit on the draft determination, with submissions due by 4pm, Thursday 12 December 2013. Parties who provide submissions will be able to comment on the submissions of other parties through a cross-submission round.