EN This text is made available for information purposes only. A summary of this decision is published in all EU languages in the Official Journal of the European Union. Case No COMP/M.6497 – HUTCHISON 3G AUSTRIA / ORANGE AUSTRIA Only the EN text is authentic. REGULATION (EC) No 139/2004 MERGER PROCEDURE Article 8 (2) Date: 12/12/2012 EUROPEAN COMMISSION Strasbourg, 12.12.2012 C(2012) 9198final PUBLIC VERSION COMMISSION DECISION of 12.12.2012 addressed to: Hutchison 3G Austria Holdings GmbH declaring a concentration to be compatible with the internal market and the EEA agreement (Case No M.6497 – HUTCHISON 3G AUSTRIA / ORANGE AUSTRIA) (Text with EEA relevance) (Only the English text is authentic.) TABLE OF CONTENTS 1. THE PARTIES............................................................................................................. 7 2. THE CONCENTRATION........................................................................................... 8 2.1. The acquisition of Yesss! by TA.................................................................................. 9 2.2. Acquisition of Orange assets by TA from H3G........................................................... 9 3. UNION DIMENSION................................................................................................. 9 4. PROCEDURE............................................................................................................ 10 4.1. General procedure...................................................................................................... 10 4.2. Referral Request......................................................................................................... 11 5. RELEVANT MARKETS...........................................................................................11 5.1. Introduction................................................................................................................ 11 5.2. Product markets.......................................................................................................... 12 5.2.1. Mobile telecommunications services to end customers............................................. 12 5.2.1.1. Private and business customers.................................................................................. 12 5.2.1.1.1. The view of the Notifying Party............................................................................... 12 5.2.1.1.2. The Commission's assessment ................................................................................. 12 5.2.1.2. Pre-paid and post-paid services.................................................................................. 13 5.2.1.2.1. The view of the Notifying Party............................................................................... 13 5.2.1.2.2. The Commission's assessment ................................................................................. 14 5.2.1.3. Type of Technology (2G, 3G and Future 4G Technologies)..................................... 14 5.2.1.3.1. The view of the Notifying Party............................................................................... 14 5.2.1.3.2. The Commission's assessment ................................................................................. 15 5.2.1.4. Voice telecommunications and data services............................................................. 16 5.2.1.4.1. The view of the Notifying Party............................................................................... 16 5.2.1.4.2. The Commission's assessment ................................................................................. 16 5.2.1.5. Fixed and mobile data services .................................................................................. 18 5.2.1.5.1. The view of the Notifying Party............................................................................... 18 5.2.1.5.2. The Commission's assessment ................................................................................. 18 5.2.1.6. Conclusion.................................................................................................................. 19 5.2.2. Wholesale market for access and call origination on public mobile telephone net- works.......................................................................................................................... 19 5.2.2.1. The view of the Notifying Party................................................................................. 19 5.2.2.2. The Commission's assessment ................................................................................... 19 5.2.2.3. Conclusion.................................................................................................................. 20 5.2.3. Wholesale market for international roaming.............................................................. 20 EN 2 EN 5.2.4. Wholesale market for mobile call termination........................................................... 20 5.3. Geographic markets ................................................................................................... 21 5.3.1. Mobile telecommunications services to end customers............................................. 21 5.3.2. Wholesale access and call origination on public mobile telephone networks ........... 21 5.3.3. Wholesale market for international roaming.............................................................. 22 5.3.4. Wholesale market for mobile call termination........................................................... 22 6. COMPETITIVE ASSESSMENT IN THE MARKET FOR MOBILE TELECOM- MUNICATION SERVICES TO END CUSTOMERS ............................................. 23 6.1. Introduction................................................................................................................ 23 6.2. Factors likely to lead to a significant impediment to effective competition.............. 24 6.3. Description of the market........................................................................................... 27 6.3.1. Market players in Austria (MNOs, MVNOs, resellers) ............................................. 27 6.3.1.1. MNOs......................................................................................................................... 27 6.3.1.2. MVNOs and second brands ....................................................................................... 29 6.3.1.3. Resellers ..................................................................................................................... 30 6.3.2. Regulatory requirements for setting up mobile telecommunications networks......... 30 6.3.2.1. General authorisation................................................................................................. 30 6.3.2.2. Allocation of frequencies ........................................................................................... 30 6.3.2.3. Approval of customer terms and conditions .............................................................. 30 6.3.2.4. Ancillary regulatory requirements ............................................................................. 31 6.3.3. Regulatory requirements for installing new masts..................................................... 31 6.3.4. Spectrum auctions...................................................................................................... 33 6.4. Market shares and market structure post-merger....................................................... 34 6.4.1. Introduction................................................................................................................ 34 6.4.2. Market shares on the overall market for mobile telecommunications services to end customers.................................................................................................................... 34 6.4.3. HHI and other indicators of the competitive dynamics in the market ....................... 36 6.4.3.1. HHI and delta values.................................................................................................. 36 6.4.3.2. Differential effects of the transaction according to market segments........................ 36 6.4.3.2.1. Post-paid private voice and data segment ................................................................ 39 6.4.3.2.2. Data-only segment.................................................................................................... 41 6.4.3.2.3. Indications of market strength based on new business ............................................ 43 6.4.3.2.3.1. New business for post-paid private voice and data............................................... 45 6.4.3.2.3.2. New business for data-only devices...................................................................... 46 6.5. Switching and closeness of competition .................................................................... 46 6.5.1. Diversion ratios.......................................................................................................... 48 EN 3 EN 6.5.1.1. The view of the Notifying Party................................................................................. 48 6.5.1.2. The Commission's assessment ................................................................................... 48 6.5.1.2.1. Evidence on switching from the MNP Data............................................................. 48 6.5.1.2.2. Evidence from surveys............................................................................................. 50 6.5.2. Other evidence on closeness of competition.............................................................