Swisscom's Fiber Optic Expansion Under Investigation
January 04 2011 - 6:57AM
Dow Jones News
Swiss telecoms provider Swisscom AG (SCMN.VX) said Tuesday that
its joint venture agreements to extend the fiber-optic network in
two areas of Switzerland are being examined by the country's
competition authority amid concerns they could reduce competition
for broadband internet access.
The Swiss Competition Commission, Comco, will investigate
projects in Fribourg, western Switzerland and St Gallen in the
north-east to see whether agreements signed by Swisscom with local
utility providers could be anti-competitive. Comco, which has the
power to delay work and demand contracts are renegotiated, said
there were "indications" that the proposed creation of the Fribourg
joint venture "established or strengthened a dominant
position."
Swisscom entered into a joint venture with the canton of
Fribourg and the west Switzerland-based electricity producer and
distributor Groupe E, in autumn 2010.
Comco also said it is launching an investigation into the
building of a fiber-optic network in the city of St Gallen, where
Swisscom has signed a deal with the local utility provider. Comco
has received complaints from the Swiss Cable Association, the body
which represents cable TV operators in the country.
The regulator said it expects to reach a decision within four
months.
The Fribourg and St Gallen projects are part of Swisscom's plans
to spend CHF2 billion upgrading bandwidth for around a third of all
Swiss households by 2015.
Similar projects are underway in Geneva, Zurich and Berne and
Basel.
Rafael Corazza, general manager at Comco, said the regulator
would also look at these other contracts.
"We will examine if they establish a restrictive or dominant
positions. If this is so, we will look at fair remedies," he
said.
Swisscom spokesman Carsten Roetz said work continued on the
projects while the company awaited a decision. He said the company
is confident that its fiber contracts are compliant with the law
and do not exclude other market participants.
-By John Revill, Dow Jones Newswires; +41 43 443 8042 ;
john.revill@dowjones.com
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