Vodafone 2004 Annual Report Download - page 17

Vodafone Portugal has requested the renewal of its 2G licence for a further 15 years,
which is due to expire in October 2006.
Spain
Legislation implementing the new EU Framework was enacted in November 2003.
Remaining regulations, implementing the new EU Framework, on SMP and universal
service are expected to be completed in 2004. The NRA has commenced its market
reviews, which are expected to be completed during 2004.
In December 2003, the NRA imposed price caps on average mobile termination rates
of all mobile network operators. The mobile termination rate of Vodafone España S.A.
(“Vodafone Spain”) was set at 14.62 eurocents from 31 January 2004. The Spanish
NCA is conducting an investigation following a complaint of alleged price squeezing
against Telefonica, Vodafone Spain and Amena, and has now issued a Statement of
Objections which will be considered by the Competition Tribunal during 2004.
Vodafone Spain is contesting this Statement of Objections. In April 2004, the NCA
requested Spanish mobile operators to provide data on SMS pricing, although it has
not yet opened an official proceeding.
Albania
In May 2004, the NRA designated Vodafone Albania as having SMP in the mobile
market, this may lead to increased regulation. Vodafone Albania has appealed this
decision. In addition, the NRA intends to regulate mobile interconnection rates,
Vodafone Albania is preparing to appeal any such regulation.
Romania
In March 2003, the NRA determined Mobifon S.A. as having SMP in the national
interconnection market. From 31 December 2003 until the development of a LRIC
model, Mobifon’s mobile termination rates were reduced from 0.11 USD to 0.10 USD.
The completion of a LRIC model and the calculation of a LRIC-based average mobile
termination rate are scheduled for July 2004.
Americas
United States
The Federal Communications Commission (“FCC”), the United States’ NRA, has
investigated the level of termination rates charged by foreign mobile operators to fixed
operators and has issued an Order in which it committed to undertake a Notice of
Inquiry into foreign mobile termination rate impact on US carriers and consumers. The
FCC stated that it is “very concerned about the possibility that US consumers might be
paying rates that are unreasonably high or discriminatory”. The inquiry is expected to
begin within six months from April 2004 and will seek input on the status of foreign
mobile termination rates, including actions taken by foreign regulators addressing the
issue to date.
From 2 February 2004, the FCC allowed certain spectrum licensees, including mobile
operators, to enter various types of leasing arrangements with third parties. Licensees
in general may, within the scope and term of their licence, lease any amount of
spectrum, in any geographic area, for any time period.
In November 2003, the FCC adopted licensing and flexible service rules for advanced
wireless spectrum at 1.7 GHz and 2.1 GHz, which the FCC is expected to license via
auction in 2005 at the earliest.
From 24 November 2003, the FCC required US mobile operators to provide mobile
number portability for customers switching their mobile operator within the same local
service area.
Annual Report 2004 Vodafone Group Plc
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and the licensees are being held on the implications of failure to achieve this
obligation.
The NRA has requested expressions of interest in the allocation of a 450MHz licence
for the provision of PAMR services and is currently considering the nature of the
award process.
Belgium
Belgium is expected to enact national law implementing the new EU Framework
during 2004. The NRA has commenced its market reviews.
France
France is expected to enact national law implementing the new EU Framework during
2004.
The NRA has commenced work to consider new price controls on mobile call
termination charges for the period 2005-2007. In December 2003, a French
consumers association lodged a complaint with the national competition authority
alleging collusion amongst the three French mobile operators on SMS retail pricing.
The French Government has agreed to extend SFR’s 2G licence until March 2021.
SFR will be required to pay an annual fee of a25 million plus 1% of 2G turnover per
year from March 2006.
The NRA postponed the obligation to commercially launch 3G services until
31 December 2004.
Poland
Legislation implementing the new EU Framework in Poland, which joined the EU on
1 May 2004, is due for enactment during 2004.
Southern Europe
Italy
Italy enacted national law implementing the new EU Framework in September 2003.
The NRA has commenced its market reviews, which are expected to be completed
during 2004.
Greece
Greece is expected to enact national law implementing the new EU Framework during
2004. Vodafone-Panafon Hellenic Telecommunications Company S.A. (“Vodafone
Greece”) reduced mobile termination rates for fixed to mobile calls on 5 October 2003
from 19 eurocents and a minimum charge of 42 seconds to 17.5 eurocents and a
minimum charge of 33 seconds and further reduced its rates on 1 January 2004 to
17 eurocents with a minimum charge of 30 seconds. On 1 October 2003, it reduced
the mobile termination rate for mobile to mobile calls from 19 eurocents with a
minimum charge of 42 seconds to 18 eurocents with a minimum charge of 30
seconds.
Malta
Legislation implementing the new EU Framework in Malta, which joined the EU on
1 May 2004, is due for enactment during 2004.
Portugal
Portugal enacted national law implementing the new EU Framework in February 2004.
The NRA has commenced its market reviews, which are expected to be completed
during 2004. In July 2003, Vodafone Portugal-Comunicações Pessoais, S.A,
(“Vodafone Portugal”) agreed to reduce its mobile termination rates by 7% per quarter,
with the last reduction proposed for 1 April 2004, and did so for the three successive
quarters ending January 2004.