Czech PM pledges shake up in mobile data market

13-02-2017

A shake-up of the Czech mobile phone scene in which callers will no longer be held ransom for high prices by a threesome of big telecom operators. That is what the leaders of the biggest Czech political parties are now promising with changes in the law being promised that would pave the way for that to happen.

Bohuslav Sobotka, photo: Khalil BaalbakiBohuslav Sobotka, photo: Khalil Baalbaki Mobile broadband is the technical name for it. But to most mobile phone and tablet users it’s just the connection that allows them to use the Internet and download photos and videos on their devices. It’s a pretty basic service in today’s interconnected data driven world, but in the Czech context it is the next frontier where high charges continue to exist after those were already driven down for phone calls and SMS services.

The high charges faced by most Czechs has now climbed up the political agenda. Prime Minister Bohuslav Sobotka addressed the issue:

“Some countries have prices which are around a tenth of what they are in the Czech Republic. And when you look at the proportion of household budgets which are spent on mobile data, we are among the four most expensive states in the whole of the European Union.”

The prime minister says a sharp drop in mobile data prices should come by the end of the year. And the call for action is being backed by ANO leader and minister of finance Andrej Babiš, who polls have steadily tipped as the likely winner of parliamentary elections in the Autumn.

One weapon against the big three Czech telecom operators should be a change in the law allowing customers to switch their operator within 10 days instead of the current 40. Another promised change is to allow the sector watchdog, the Czech Telecoms Office (ČTU) to impose bigger fines on the dominant operators for moves aimed at curbing competition.

Jaromír Novák is chairman of the office and told Czech Television what he believes might happen when the proposed new rules take effect.

Photo: Barbora NěmcováPhoto: Barbora Němcová “It will certainly help us to unblock customers so that they will better be able to move between different operators. What we see at the moment in the household market is that they are imprisoned at the moment in multi-annual contracts. If another operator comes up with an attractive price offer then they cannot quickly terminate their existing contract and take up the offer. In this sense, the amendment should give freedom to customers.”

Another facet is whether major new operators might join the apparently cosy threesome of T-Mobile, O2, and Vodafone on the Czech market. That was promised back in 2013, when the telecoms office auctioned off more broadband capacity which was supposed to boost competition. But the auction for that new capacity was eventually cancelled because the bids from the existing operators were so high that no benefits for consumers looked likely.

Then, one potential fourth operator was the Czech financial group PPF. Since then though PPF joined the threesome after a buyout of O2. But there are still high hopes that a fourth operator, perhaps the existing company Air Telecom, will emerge and offer a real shake up of the telecoms market over the next year.

13-02-2017