EUROPEAN COMMISSION DG Competition CASE M.7758-HUTCHISON 3G ITALY / WIND / JV (Only the English text is authentic) MERGER PROCEDURE REGULATION (EC) 139/2004 Article 8(2) Regulation (EC) 139/2004 Date: 01/09/2016 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. Parts of this text have been edited to ensure that confidential information is not disclosed; those parts are enclosed in square brackets. EN EN EUROPEAN COMMISSION Brussels, 1.9.2016 C(2016) 5487 final Public Version COMMISSION DECISION of 1.9.2016 declaring a concentration to be compatible with the internal market (Case M.7758 – HUTCHISON 3G ITALY / WIND / JV) (Only the English text is authentic) EN EN TABLE OF CONTENTS 1. Introduction ................................................................................................................ 13 2. The operation and the concentration .......................................................................... 13 3. Union Dimension ....................................................................................................... 14 4. The procedure ............................................................................................................. 15 4.1. General procedure ...................................................................................................... 15 4.2. Referral request .......................................................................................................... 16 5. The Italian mobile telecommunications sector .......................................................... 16 5.1. Key metrics ................................................................................................................ 17 5.1.1. Mobile telecoms penetration and mobile revenues .................................................... 17 5.1.2. Importance of different mobile market segments ...................................................... 18 5.1.2.1. Prepaid and postpaid plans ......................................................................................... 18 5.1.2.2. Private and business customers .................................................................................. 19 5.1.2.3. Voice, SMS and data services .................................................................................... 19 5.2. Technological development ....................................................................................... 22 5.3. Customer switching .................................................................................................... 24 5.4. Mobile telecommunications services providers in Italy ............................................. 25 5.4.1. MNOs ......................................................................................................................... 25 5.4.1.1. TIM ............................................................................................................................ 25 5.4.1.2. Vodafone .................................................................................................................... 26 5.4.1.3. WIND ......................................................................................................................... 27 5.4.1.4. H3G ............................................................................................................................ 27 5.4.2. Other mobile telecommunications services providers, including MVNOs ............... 28 5.4.2.1. Main MVNOs active in Italy ...................................................................................... 28 a) PosteMobile................................................................................................................ 29 b) Fastweb ...................................................................................................................... 30 c) Other MVNOs ............................................................................................................ 30 5.4.2.2. Regulatory regime regarding MVNOs ....................................................................... 30 5.5. Spectrum holdings ...................................................................................................... 31 5.6. Mobile telecommunications infrastructure and agreements between MNOs ............ 32 5.6.1. Background to network sharing ................................................................................. 32 5.6.2. Network sharing in Italy ............................................................................................. 34 5.6.3. National roaming in Italy ........................................................................................... 34 5.6.4. Mobile communication towers in Italy ...................................................................... 35 6. Relevant markets ........................................................................................................ 36 EN 2 EN 6.1. Analytical framework ................................................................................................. 36 6.2. Retail mobile telecommunications services ............................................................... 37 6.2.1. Product market definition ........................................................................................... 37 6.2.1.1. Parties' view ............................................................................................................... 37 6.2.1.2. Commission's assessment .......................................................................................... 38 a) Retail fixed vs mobile telecommunications services ................................................. 38 b) Segmentations within retail mobile services .............................................................. 40 i. Type of technology (2G, 3G and 4G) ........................................................................ 41 ii. Voice, SMS and data services .................................................................................... 41 iii. Prepaid and postpaid services .................................................................................... 42 iv. SIM only and handset subscriptions .......................................................................... 43 v. Private and business customers .................................................................................. 44 c) Conclusion on product market definition ................................................................... 46 6.2.2. Geographic market definition .................................................................................... 46 6.2.2.1. Parties' view ............................................................................................................... 46 6.2.2.2. Commission's assessment .......................................................................................... 46 6.3. Wholesale services for access and call origination on mobile networks ................... 47 6.3.1. Product market definition ........................................................................................... 47 6.3.1.1. Parties' view ............................................................................................................... 47 6.3.1.2. Commission's assessment .......................................................................................... 47 6.3.2. Geographic market definition .................................................................................... 48 6.3.2.1. Parties' view ............................................................................................................... 48 6.3.2.2. Commission's assessment .......................................................................................... 48 6.4. Wholesale international roaming services ................................................................. 49 6.4.1. Product market definition ........................................................................................... 49 6.4.1.1. Parties' view ............................................................................................................... 49 6.4.1.2. Commission's assessment .......................................................................................... 49 6.4.2. Geographic market definition .................................................................................... 50 6.4.2.1. Parties' view ............................................................................................................... 50 6.4.2.2. Commission's assessment .......................................................................................... 50 6.5. Wholesale services for mobile call termination ......................................................... 50 6.5.1. Product market definition ........................................................................................... 50 6.5.1.1. Parties' view ............................................................................................................... 50 6.5.1.2. Commission's assessment .......................................................................................... 51 6.5.2. Geographic market definition .................................................................................... 51 6.5.2.1. Parties' view ............................................................................................................... 51 6.5.2.2. Commission's assessment .........................................................................................