Bankinter | Telefónica (TEF) will no longer be obliged to lease its networks to rival operators at a regulated price. This liberalisation process began in 2016 when the National Commission for Markets and Competition (CNMC) ruled that there was sufficient competition in 66 cities representing 35% of the population; in 2021, it extended liberalisation to 696 towns, covering a total of 70% of the population, and now the remaining 30% is being liberalised. Although access to the fibre network is being liberalised, Telefónica will still be obliged to offer regulated access to its physical infrastructure (ducts, poles, etc.) under the MARCo offer.
Bankinter analysis team’s view: This measure was already known and culminates a liberalisation process that began in 2016 and already affected the most densely populated areas, which are the most attractive from a commercial point of view. The measure gives Telefónica greater commercial freedom to freely negotiate prices and conditions for access to its fibre network with other operators without being subject to regulated tariffs. Telefónica will be able to optimise the profitability of its infrastructure and adapt its agreements to market conditions.
This could enable Telefónica to improve its margins in the wholesale business, especially in areas where its network is dominant. We expect Telefónica to reach bilateral agreements with operators such as Vodafone, MásOrange and Digi, which could facilitate greater commercial collaboration. In competitive areas, where there are already multiple operators, liberalisation will encourage more offers and promotions for consumers; in less populated areas, where competition is lower, prices could rise and promotional options could be reduced, although technologies such as 5G FWA and Starlink offer alternatives.
