TP SA's rule holds firm

Telekomunikacja Polska (TP SA) monopoly on the Polish telecom market is holding strong and the situation is unlikely to change very soon, according to a report by the Adam Smith Center.

The center's document 'How to Overcome the Fixed Telephony Deadlock' makes grim reading for TP SA competitors.

"Only 10 percent of fixed telephony users have access to alternative operators," says the report's author, Andrzej J. Piotrowski.

Even though the number of mobile-phone users long ago surpassed the number of fixed-line owners, still 70 percent of all phone calls is done via land lines," says Piotrowski.

Because of TP SA's control of the telecom infrastructure, all new fixed telephony operators have to pay for access to land lines, which blows their telephone bills out of proportion.

According to the Adam Smith Center, the value of TP SA's monopoly rent - the income that accrues due to its monopoly power -  amounts to some 29 percent, which means that every year the company absorbs approximately zł.4 billion from the Polish market. The center says it is no wonder then that among 31 biggest world economies, Poland is the fourth most expensive country when it comes to telecom services.

The report suggests the right way to fight the TP SA monopoly would be local loop unbundling i.e. making the telecom-links available for all operators or wholesale line rental (WLR), which makes it possible for the alternative operators to invoice the users with one bill for line rental and call charges.