2018CZECH TELECOMMUNICATION OFFICE ANNUAL REPORT MAY 2019 Czech Telecommunication Office 2018 Annual Report of the Czech Telecommunication Office Including: Annual report on universal service Annual report on provision of information pursuant Act No. 106/1999 Coll. Information on settling complaints on CTU’s activity Annual report on out-of-court settlement of consumer disputes CONTENT Situation and Development of the Electronic Communications and Postal Services Market in 2018 1 1 Evaluation of the electronic communications market. .13 1.1 Regulation of the electronic communication market .............................13 1.1.1 Process of the analyses of the relevant markets in 2018 ...................13 1.1.2 Application of price regulation for wholesale electronic communications services .........................................................................16 1.1.3 Updating the value of the Weighted Average Cost of Capital (WACC) ........16 1.2 Development in the main segments of the retail market .........................17 1.2.1 Services provided in mobile networks ..............................................17 1.2.2 Development of mobile data services .....................................20 1.2.3 Volume of transmitted data ..............................................22 1.2.4 Prices of mobile services .................................................24 1.2.5 High-speed Internet access services ......................................32 1.2.6 The retail prices of high-speed access services ............................36 1.2.7 Voice services provided on fixed networks .................................37 1.3 Development of prices for selected wholesale services ...........................40 1.3.1 The local loop unbundling wholesale market ...............................40 1.3.2 Wholesale high-speed Internet access ....................................42 1.3.3 The wholesale market of call termination on individual public mobile telephone networks .........................................................................43 1.3.4 Wholesale market of call termination in individual public telephone networks provided at a fixed location. .43 1.4 Evaluation of changes in the mandatorily published reference offers relating to the provision of LTE services ..............................................................44 2 Auction of radio frequencies ..................................................46 3 Telephone number portability ................................................47 3.1 Portability in mobile networks ..................................................47 3.2 Portability in fixed networks ....................................................48 4 Evaluation of the postal services market .......................................49 4.1 Situation of the postal market ..................................................49 4.2 Development of the universal services in 2018 ..................................54 4.2.1 Regulation in the area of universal services ................................56 4.2.2 Development of the prices of the universal services in 2018 ................57 4.2.3 Funding of the universal services .........................................59 4.3 Regulation in the area of parcel delivery .........................................60 5 Terrestrial digital television and digital radio broadcasting. 61 5.1 Television broadcasting ........................................................61 5.1.1 Release of the 700 MHz frequency band and transition to terrestrial digital television broadcasting DVB-T2 .......................................................61 5.2 Radio broadcasting and preparation for future digital broadcasting ...............61 6 Legal Framework ...........................................................62 6.1 Amendments of the Electronic Communications Act .............................63 6.2 Amendments of the Postal Services Act .........................................63 6.3 Amendments of the Act on measures to reduce the costs of implementation of high- speed networks of electronic communications .........................................63 6.4 Other laws and regulations .....................................................64 ANNUAL REPORT 2018 | 1 Expert and administrative activities of CTU 1 Consumer protection ........................................................72 1.1 Price calculators. 72 2 1.2 Price barometer ...............................................................72 1.3 Subscriber contracts. 72 1.4 Net neutrality – Internet access (open Internet). 73 2 Settlement of subscriber disputes and user complaints. .74 2.1 First-instance administrative proceedings .......................................74 2.2 Second-instance administrative proceedings ....................................74 2.3 Disputes in the area of postal services ..........................................77 2.4 Complaints of the subscribers and users of electronic communication services ....78 2.5 Complaints of the users of postal services .......................................79 3 Automated system of monitoring of the frequency spectrum .....................80 4 Inspection activities .........................................................81 4.1 Keeping records and checking undertakings in electronic communications and postal services ..81 4.2 Checking the compliance with CTU decisions ....................................81 4.2.1 Checking the compliance with the conditions of the Measure of general nature No. OOP/10/10.2012-12 ..81 4.2.2 Checking the compliance with the conditions of Measure of General Nature No. VO-R/12/09-2010-12 ...81 4.2.3 Checking the compliance with the conditions of general authorization No. VO-R/10/05-2014-3 ..82 4.2.4 Inspection of public payphones ...........................................82 4.2.5 Checking the compliance with the legal obligations under the Electronic Communications Act, under the Consumer Protection Act, and under the Postal Services Act ... 82 4.3 Investigation of the interference with the digital television signal in relation to the operation of LTE networks in the 800MHz frequency band ..............................83 4.4 Cooperation with Czech Trade Inspection Authority ..............................83 5 Radio spectrum management ................................................84 5.1 Decisions on radio frequency block allocations ...................................84 5.2 Decisions on authorizations to use radio frequencies ............................84 5.3 Use of radio frequencies under general authorizations ...........................85 5.4 Testing qualification ...........................................................85 5.5 Refarming the 900 MHz frequency band ........................................86 5.6 Fees for the use of radio frequencies ............................................86 6 Number management .......................................................87 7 Settlement of disputes between entities carrying out communication activities ....87 8 Settlement of disputes between providers of postal services. 88 9 Settlement of disputes pursuant to Sections 5, 9, 10 and 14 of Act No. 194/2017 Coll.. 88 10 Crisis management and security ..............................................89 11 Media activities .............................................................90 11.1 Press releases and monitoring reports .........................................91 11.2 Bulletins ......................................................................91 11.3 CTU website ..................................................................92 11.4 Telecommunication Academy ..................................................92 11.5 Social media .................................................................92 12 International Activities ......................................................92 12.1 CTU activities with respect to the European Union ..............................93 12.1.1 International activities of CTU in relation to other international bodies and organizations . 96 12.2 Other international activities. 97 2 | CZECH TELECOMMUNICATION OFFICE Information on the need to pass new regulations or amend the existing regulations 3 1 Electronic Communications ................................................ 100 1.1 The need for an amendment of the Electronic Communications Act ..............100 1.1.1 The need to issue implementing regulations for the Electronic Communications Act .100 2 Postal services. 100 2.1 The need for an amendment of the Postal Services Act .........................100 2.1.1 The need to issue implementing regulations for the Postal Services Act. .101 Organization and resources to perform CTU’s tasks 1 Financial results of CTU .................................................... 106 1.1 Evaluation of the achievement of the indicators of chapter 328 – Czech 4 Telecommunication Office. .106 2 Management of non-budgetary funds ....................................... 109 2.1 Radiocommunication Account .................................................109 3 Results of external audits .................................................. 110 4 Civil Service Act ........................................................... 110 5 Human resources ......................................................... 110 5.1 2018 budget .................................................................111 5.2 Funds for the salaries of CTU employees .......................................111 5.3 Number of systemized positions. .111 5.4 Other payments for the work done ............................................112