Top telecoms firms investigated in European competition probe

City A.M. Reporter
EUROPE’S competition watchdog is investigating some of the region’s biggest telecoms firms over whether they abused their market position in deals with Internet companies to deliver content to consumers.

Offices of Deutsche Telekom, France’s Orange SA and Spain’s Telefonica were searched by antitrust regulators after a complaint by a US-based competitor, two people familiar with the matter said yesterday.

US-based Cogent Communications – a middleman, or transit provider, that carries global traffic on behalf of Internet companies that want to reach consumers – has filed similar complaints against several European telecom operators in recent years.

Two people close to the situation said that the current Brussels inquiry was also related to the issues raised by Cogent.

The EU Commission said yesterday it raided the offices of some telecoms providers in several countries on 9 July but did not identify the companies nor the specific objective, in line with its usual policy.

“The Commission has concerns that the companies concerned may have violated EU antitrust rules that prohibit the abuse of a dominant market position,” the EU executive said in a statement. “Internet connectivity ... is crucial for the functioning of the Internet and for end users’ ability to reach Internet content with the necessary quality of service, irrespective of the location of the provider,” it said.

Deutsche Telekom and Orange confirmed the raid. Orange and Telefonica said separately that they were co-operating fully with the inspections.