10.9.2002EN Official Journal of the European Communities C 214/17 Notice pursuant to Article 19(3) of Council Regulation No 17 Case COMP/C1/N.38.370 —BT Cellnet & BT3G/One2One Personal Communications (United Kingdom Agreement) (2002/C 214/08) (Text with EEA relevance) 1. INTRODUCTION through its subsidiaries, networks in the United Kingdom (BT Cellnet — renamed O2 UK Limited and BT3G), 1. On 6 February 2002, BT-Cellnet Limited (‘BT Cellnet’) and Germany (VIAG — renamed O2 Germany), the BT3G Limited (‘BT3G’) (now renamed O2 UK Limited) and Netherlands (Telfort — renamed O2 Netherlands), the One2One Personal Communications Limited (‘One2One’) Republic of Ireland (Digifone — renamed O2 Ireland) (now renamed T-Mobile (UK) Limited) notified to the and the Isle of Man (Manx Telecom). In the financial Commission an agreement of 20 September 2001 year ending 31 March 2002, mmO2 group had a concerning infrastructure sharing and national roaming turnover of GBP 4.3 billion (about EUR 6,7 billion). on the United Kingdom market for the third generation of GSM mobile telecommunications (‘3G’). In their notifi- cation BT Cellnet, BT3G and One2One (‘The Parties’) have requested either negative clearance under Article 81(1) or an exemption under Article 81(3) of the EC Treaty (1). 4. One2One is a licensed mobile telecommunications operator of 2G and 3G networks in the United Kingdom and is a wholly owned subsidiary of Deutsche Telekom Mobile Holdings Limited, a wholly owned subsidiary of T-Mobile International AG. T-Mobile International AG owns interests in mobile telecommunications operators 2. In February 2002 the Commission published a first notice in the United Kingdom (One2One — rebranded as summarising the notified agreement and inviting third T-Mobile (UK) Limited, T-Motion, Virgin Mobile), Austria 2 party comments ( ). The Commission has now finished (max.mobil.), the Czech Republic (Radiomobil) and the its examination of the notified agreement and has come United States of America (VoiceStream). T-Mobile Inter- to a preliminary position. The present notice is published national AG also has subsidiaries active in the Netherlands pursuant to Article 19(3) of Regulation 17/62 in order to (BEN, CMobil), Russia (MTS) and Poland (PTC). In the enable third parties to provide their comments on the 2001 financial year, DTAG had a worldwide turnover of Commission's proposed approach. Third parties may EUR 48,3 billion and T-Mobile International AG had a submit their comments to the Commission within a worldwide turnover of EUR 14,6 billion. deadline of one month from publication of this notice in the Official Journal of the European Communities. 3. PRODUCTS/SERVICES 5. 3G services are mobile communications systems capable of 2. THE PARTIES supporting in particular innovative multimedia services, beyond the capability of second generation systems such 3. BT Cellnet is a licensed mobile telecommunications as GSM, and capable of combining the use of terrestrial operator of a 2G network and BT3G is licensed to and satellite components. These services are characterised operate a 3G network (3) in the United Kingdom and by their: (i) multimedia capabilities, full mobility and low both are wholly owned subsidiaries of mmO2 plc, the mobility applications in different geographical mobile telecommunications business previously controlled environments beyond 2G capabilities; (ii) efficient access by British Telecommunications plc. mmO2 operates, to Internet, Intranets and other Internet protocol based services; (iii) high quality speech transmission commen- (1) The Commission has also received a related notification from surate with that of fixed networks; (v) service portability T-Mobile Deutschland GmbH and VIAG Interkom GmbH dated 1 across 3G environments; (v) operation in one seamless February 2002 relating to a 3G Network Deployment and 3G environment including full roaming with GSM as well as Bilateral Roaming Agreement in Germany. This agreement is being dealt with separately (Case COMP/N.38.369 — Rahmen- between the terrestrial and satellite components of UMTS vertrag). networks. With this agreement, the Parties aim to enter the (2) OJ C 53, 28.2.2002, p. 18. United Kingdom national market or markets for 3G infra- structure and wholesale roaming services. Although the (3) In May 2000, the United Kingdom Government awarded five 3G licences following a frequency auction procedure worth EUR 38,5 agreement promotes their individual entry into the billion. The companies awarded the licences were Orange, BT3G, market or markets for 3G retail services the agreement Vodafone, One2One and H3G. does not directly relate to retail markets. C 214/18EN Official Journal of the European Communities 10.9.2002 6. The products/services that are directly concerned by this 9. Finally, in March 2001 the Commission published a notification are (a) access to and use of 2G, 2,5 G and 3G Communication setting out the state of play and the infrastructure, and (b) wholesale access to 3G national way forward for the introduction of third generation roaming. Actual or potential competitors in these mobile communications in the EU (7). This Communi- markets are the other three licencees for 3G networks cation takes note of the combination of the difficult and services in the United Kingdom, and potential financial situation of telecommunications operators competitors may be third parties reselling access to and throughout the EU and of the high infrastructure wholesale roaming services on the network of these other investment costs involved that lead operators to engage operators or on the Parties' networks. As 3G networks and in infrastructure sharing arrangements. It concludes that services have not yet been rolled out no conclusive economically beneficial sharing of network infrastructure estimate of market shares or assessment of the substituta- should in principle be encouraged, provided the bility between 2G and 3G services can at present be competition rules and other relevant Community law are provided. respected (8). In its recent follow up Communication (9), the Commission emphasised that it would continue to work with national administrations towards establishing a best practice approach for network sharing. 4. LEGAL AND FACTUAL BACKGROUND 4.1. The development of third generation mobile communications in the EU 4.2. Network sharing 7. So far digital mobile communications networks and 10. The basic distinction that is relevant in the context of the services in the EU have been based on the GSM family Parties' network sharing agreement is that between the of standards. European telecommunication companies are Radio Access Network (‘RAN’) and the core or backbone at present developing and rolling out mobile communi- network. cation networks and services using the third generation (‘3G’) of the GSM family of standards (4) 3G will combine wireless mobile technology with high data trans- mission capacities and facilitate consumer access to Internet services through their mobile handsets. Its devel- 11. RAN: this includes mast/antenna sites, site support opment in the EU is based on a common technological cabinets (‘SSC’) and power supply, as well as antennas, platform — Universal Mobile Telecommunications System combiners and transmission links, Nodes B, i.e. the base (‘UMTS’), on the harmonisation of the radio spectrum and stations that receive and send data across frequencies and on the definition of a harmonised regulatory environment. control a particular network cell, and the radio network controllers (‘RNCs’) that each control a number of such nodes B and that are linked to the core network. 8. To meet these harmonisation objectives, the European Parliament and the Council have in 1997 adopted a directive on a common framework for general authoris- 12. Core netwerk: this is the intelligent part of the network ations and individual licences in the field of telecommuni- that consists of mobile switching centres (‘MSCs’), various cations services (5). This was followed at the end of 1998 support nodes, services platforms, client home location by a decision on the coordinated introduction of a third- registers and operation and maintenance centres. It is generation mobile and wireless communication system linked to the fixed ISDN (integrated services digital (UMTS) in the Community (6). It required Member States network) and Internet networks. to enable the introduction of UMTS services on their territory by 1 January 2002 and emphasised the role of technical bodies such as the European Conference of Postal and Telecommunications Administrations (‘CEPT’) and Europe Telecommunications Standard Institute (‘ETSI’) in harmonising frequency use and promoting a common and open standard for the provision of compatible UMTS services throughout Europe. (4) The first generation was GSM 900, the second generation DCS 1800 (now referred to as GSM 1800), GPRS is often regarded as an intermediate step (or ‘2,5 G’) between 2G and 3G. (5) Directive 97/13/EC of the European Parliament and of the Council 7 of 10 April 1997 (OJ L 117, 7.5.1997, p. 15). This directive sets ( ) The introduction of third generation mobile communications in the out the procedures associated with the granting of authorisations European Union: state of play and the way forward, COM(2001) for the purpose of providing telecommunications services and the 141 final, 20.3.2001. conditions attached to such authorisations. (8) Ibid. paragraph 4.3. (6) Decision No 128/1999/EC of the European Parliament and of the (9) ‘Towards the full roll-out of third generation mobile communi- Council of 14 December 1998 (OJ L 17, 22.1.1999, p. 1). cations’COM(2002) 301 final, 11.6.2002. 10.9.2002EN Official Journal of the European Communities C 214/19 13. 3G Network sharing can take place at a number of — network roll-out requirements in terms of effective different levels and involve varying degrees of cooperation. coverage related to a specific timetable, notably a The degree of independence retained by an operator requirement to cover 80 % of the population by the depends on which network elements are being shared end of 2007, and their remaining ability to install separate elements (planning freedom).