Assessment of Dominance in Communications Markets
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Malaysian Communications and Multimedia Commission Assessment of Dominance in Communications Markets Public Inquiry Paper 11 July 2014 This document is issued as a source of information to interested parties and the general public. The information in this document is intended as a guide only. For this reason it should not be relied on as legal advice or regarded as a substitute for legal advice in individual cases. The information contained in this document may be subjected to changes without notice. Malaysian Communications and Multimedia Commission Off Persiaran Multimedia, 63000 Cyberjaya, Selangor Darul Ehsan. Tel: +60 3 86 88 80 00 Fax: +60 3 86 88 10 00 www.skmm.gov.my PREFACE The Malaysian Communications and Multimedia Commission ( MCMC ) invites submissions from industry participants, other interested parties and members of the public on the questions and issues raised in this Public Inquiry Paper on Assessment of Dominance in Communications Market . Submissions are welcome on the specific matters on which comment is sought on the MCMC’s preliminary views. Submissions are also welcome on the rationale and analysis in this Public Inquiry Paper (where no specific questions have been raised) and the following documents: (a) Market Definition Analysis; (b) Guideline on Substantial Lessening of Competition (SLC Guideline); and (c) Guideline on Dominant Position (Dominance Guideline). Such submissions should be substantiated with reasons and, where appropriate, evidence or source references. Written submissions, in both hard copy and electronic form, should be provided to the MCMC in full by 12 noon, 25 August 2014. Submissions should be addressed to: The Chairman Malaysian Communications and Multimedia Commission 63000 Cyberjaya Selangor Attention : Ms Janakky Raju /Nashah Bashah Email : [email protected] Telephone: +603 8688 8000 Facsimile: +603 8688 1001 In the interest of fostering an informed and robust consultative process, the MCMC proposes to make submissions received available to interested parties upon request. The MCMC also reserves the right to publish extracts or entire submissions received. Any commercially sensitive information should be provided under a separate cover clearly marked ‘ CONFIDENTIAL ’. However, for any party who wishes to make a confidential submission, a “public” version of the submission should also be provided. 2 The MCMC also proposes to conduct a Public Inquiry Clarification Session at which stakeholders may make oral submissions to the MCMC and seek clarification on the issues raised in this paper. The session will be held at the MCMC Auditorium, Cyberjaya on 7 August 2014 at 9:30 am. Members of the public who wish to attend the session should register with the MCMC on the above contact details by 12 noon on 25 July 2014 . Parties who wish to address questions to the MCMC during the public hearings should also notify the MCMC of those questions in advance to the above contact details by 12 noon on 25 July 2014. The MCMC would like to express gratitude to interested parties for their participation in this consultative process and look forward to receiving written submissions. 3 Contents Part A Public Inquiry 1 1 Background 1 2 Feedback 2 3 Legislative context 2 4 Outputs of public inquiry process 5 5 Overview of analytical framework 6 6 Market definition 7 7 Assessment of dominance under the Dominance Guideline 13 8 Assessing ‘substantial lessening competition’ under the SLC Guideline 23 Part B Dominance analysis 34 1 Fixed telephony services (including VoIP) 34 2 Fixed broadband and data 44 3 Mobile telephony 53 4 Mobile broadband and data (including WiMAX) 63 5 Mobile messaging services (including SMS and OTT) 69 6 Transmission (inter-exchange) 74 7 Transmission (tails) or local leased lines 84 8 Domestic managed data services 93 9 Transmission (international) and international managed data services 96 10 Transmission to submarine cable landing stations and earth stations 101 11 Broadcasting transmission 103 12 Directory services 107 13 Broadcasting services 111 14 Content acquisition 122 15 Termination (fixed and mobile) calls and messages 133 16 Origination (fixed and mobile) calls 137 17 Inter-connect links 140 18 Wholesale internet interconnection 143 19 Access to lead-in ducts and manholes 146 20 Access to inter-exchange and mainline ducts 148 21 Access to towers 151 22 Access to co-location and exchange buildings 155 23 Access to submarine cable landing stations and earth stations 157 Assessment of Dominance in Communications Markets 24 Access to full access (local loop unbundling), sub-loop, line sharing and bitstream services 159 25 Access to dark fibre 162 26 Access to main distribution frames and associated in-building wiring 164 27 Access to common in-building mobile systems 165 Annexure 1 Summary of questions 168 Annexure 2 Summary of preliminary findings on dominance 175 ii ABBREVIATIONS AND GLOSSARY ACCC Australian Competition and Consumer Commission ADSL Asymmetric Digital Subscriber Line ASEAN The Association of Southeast Asian Nations ATM Asynchronous Transfer Mode BEREC Body of European Regulators for Electronic Communications BT British Telecom c-i-c Commercial in Confidence CIIP Common Integrated Infrastructure Provider CMA Communications and Multimedia Act 1998 CTT Common Tower Technologies Sdn Bhd DEL Direct Exchanged Line DRM Digital Rights Management DSL Digital Subscriber Line DSLAM Digital Subscriber Line Access Multiplexer DTH Direct-To-Home DTTB Digital Terrestrial Television Broadcast EC European Commission EIC External Interconnection Cable EPL English Premiere League ESA Exchange Service Area EU European Union F2M Fixed to Mobile FA Football Association FAD Final Access Determination FIFA International Federation of Football Association FTA Free to Air FTTB Fibre to the Business FTTH Fibre to the Home Gbps Giga Bit Per Second HD High Definition HSBB High Speed Broadband Network HSPA High Speed Packet Access IDA Info-Communications Development Authority of Singapore IOS iPhone Operating System IP Internet Protocol IPLC International Private Leased Circuit iii IPTV Internet Protocol Television IP-VPN Internet Protocol Virtual Private Network ISDN Integrated Services Digital Network ISP Internet Service Provider ITS International Telephone Services ITU International Telecommunications Union IXP Internet Exchange Point Kbps Kilo Bit Per Second KJS Konsortium Jaringan Selangor LAN Local Area Network LLC Local Leased Circuit LMDS Local Multipoint Distribution Services LSS Line Sharing Service LTE Long Term Evolution Mbps Mega Bit Per Second MCMC Malaysian Communications and Multimedia Commission MDA Media Development Authority of Singapore MDF Main Distribution Frame Metro-E Metro-Ethernet MMS Multimedia Messaging Service MNO Mobile Network Operator MSAP Mandatory Standard on Access Pricing MTAS Mobile Terminating Access Service MVNO Mobile Virtual Network Operator MyCC Malaysia Competition Commission MyIX Malaysian Internet Exchange NBA National Basketball Association OFCOM The Office of Communications of UK OPTA The Independent Post and Telecommunications Authority of Netherlands OSI Open Systems Interconnection OTT Over-the-Top PBX Private Branch Exchange POI Point of Interconnection POP Point of Presence PPDR Public Protection and Disaster Relief PSSB Puncak Semangat Sendirian Berhad PSTN Public Switched Telephone Network PTS Postal Telecommunications Authority of Sweden iv QoS Quality of Service RAS Required Application Services RTM Radio Television Malaysia RTR Austrian Regulatory Authority for Broadcasting and Telecommunications SD Standard Definition SDH Synchronous Digital Hierarchy SDSL Symmetric Digital Subscriber Line SEA South East Asia SLC Substantial Lessening of Competition SME Small and Medium Enterprise SMS Short Messaging Services SSNIP Small but significant non-transitory increase in price SUKMA Sukan Malaysia TRA Telecommunications Regulatory Authorities TVRO Television Received Only UHF Ultra High Frequency UK United Kingdom ULL Unbundling Local Loop UNE Upstream Network Element US United States VDSL Very High Bit Rate Digital Subscriber Line VHF Very High Frequency VOD Video on Demand VoIP Voice Over Internet Protocol VoLTE Voice Over Long Term Evolution VPN Virtual Private Network VSAT Very Small Aperture Terminal Wi-Fi Wireless Fidelity WiMAX Worldwide Interoperability for Microwave Access WLR Wholesale Line Rental 3G Third Generation 4G Fourth Generation v Part A Public Inquiry 2 Background 2.1 The Malaysian Communications and Multimedia Commission ( MCMC ) is conducting a study on the assessment of dominance in the communications market. 2.2 In 2003, the MCMC undertook a dominance study which resulted in the publication of a public inquiry report on 8 December 2004 ( 2004 Dominance Study ). This study was followed by a Commission Determination on Dominant Position in Communications Market (Determination ) under section 137 of the Communications and Multimedia Act 1998 (CMA ), in which a number of licensees were found to be dominant in specified communications markets. The Determination was valid for a period of two years and has since lapsed. 2.3 Since the 2004 Dominance Study, the communications sector in Malaysia has experienced (and continues to experience) significant technological and product innovation. In the broadcasting sector, this has included the movement from linear to on-demand supply, the emergence of new cable operators, an increase in intermodal competition (for example internet protocol television (IPTV )