On paper, Bulgaria has implemented the 2002 EU common regulatory framework and 2009 revisions, with the stated purposes of Bulgarian law and regulation including the “creation of the conditions necessary for the promotion of competition in the provision of electronic communications”, “encouraging investment in infrastructure and promoting innovation” and “ensuring in similar circumstances no-discriminatory treatment of undertakings providing electronic communications networks and/or services”
Yet, despite implementation of EU liberalisation the Bulgarian mobile communications market remains uncompetitive. Three operators each have similar market shares and the same, almost full, coverage of the population. There are, practically, no Mobile Virtual Network Operators (‘MVNO’). As the geographical and technical characteristics of the three networks are almost identical, competition is based principally on price. In the last few years there has been few competitive drivers to develop new technologies. A fourth greenfield operator is, so far, the only offering LTE mobile broadband in the cities.
Elsewhere, national roaming has been used as an incentive for full service infrastructure roll out. However, given Bulgaria’s extensive 2G and 3G infrastructure, there is no economic or policy purpose for new LTE entrants to have to build a national-wide old generation network when it is possible to compensate existing carriers for wholesale network services. This also mitigates the high barriers to entry and anti-competitive structure of the mobile market identified by the Bulgarian Commission for Protection of Competition in numerous cases.
Given similar barriers to entry, and as underlined by several National Regulatory Authorities, National Competition Authorities and the European Court of First Instance, National Roaming can enhance competition on the mobile communications market and promote technological innovation. The rationale for the National Regulatory Authority, the CRC, to encourage full national roaming appears to be the following:
More effective utilization: There is no policy, regulatory or economic reason to require further roll-out of additional 2G/3G mobile infrastructure. According to the CRC Annual report for 2012, the Bulgarian mobile services market has a high level of penetration (approximately of 148%) on the 2G and 3G network services, and almost complete coverage of the territory by the three current national networks; with each operator having 99% GSM coverage, and from 76% to 96% UMTS coverage. New entrants deploying different services should be allowed to utilize the existing technology as required, compensating its owners and developing and rolling-out new technology, such as LTE. This will allow consumers to have access to the latest services. There are currently 7584 mobile masts and sites in Bulgaria. From an environmental perspective, especially given the large area of Natura 2000 , there would seem to be a case that additional infrastructure should only be constructed in densely populated areas and/or where required for the technical development of new services that cannot be provided on existing masts.
Spectrum efficiency: Spectrum is a limited resource and should be utilized in the most effective way possible to provide the most appropriate services to customers. National Roaming prevents hoarding and the underutilization.
Health & Energy Efficiency: The utilization of existing infrastructure through National Roaming mitigates perceptions of the potential dangers of electromagnetic radiation. The World Health Organization (“WHO”) has issued a number of reports and surveys on “What are the health risks associated with mobile phones and their base stations”. These public health concerns have been recognised by the Bulgarian authorities in a 2009 draft ordinance on the maximum admissible levels of electromagnetic fields in the environment. The utilization of the existing infrastructure will optimize the power consumption for masts and antennas. Currently, five large mobile operators in the world account for nearly 21 TWh of energy consumption annually. For comparison purposes, the Kozlouduy Nuclear Power Plant which is one of the largest electric energy producers in Bulgaria annually produces around 16 TWh.
Improving economic return to encourage new telecom investment: In its 2013 Annual Report, the CRC identified that investments in both the construction and maintenance of the existing telecommunication networks has decreased by 24%. Additionally, the CPC has established that one of the main structural barriers of entry to the mobile telecommunications market is the large investments in network and infrastructure that are required. It remains challenging for operators to obtain external debt financing for infrastructure roll-out and the costs of infrastructure roll-out outside of the larger urban areas makes the provision of new services such as LTE uneconomic, thus creating long-term market barriers to entry.
Encouragement of investments in the country & economic development:m4G LTE services give consumers, small and medium sized businesses, corporates and the public sector, access to the most advanced mobile experience and technologies currently available. The spectrum utilisation of 4G LTE is of a different nature to 2G and 3G. It enables broadband download speeds that allow Bulgarian IT & technology companies to demonstrate applications to potential clients, and allows Bulgarian sales teams to show corporate videos to potential clients, whilst outside of the office and without having to access potentially insecure WiFi networks.
In short, national roaming would help speed up the provision of LTE mobile broadband, encourage investment across the Bulgarian economy and provide Bulgarian and foreign companies and entrepreneurs with the most advanced communication tools.