Spain: Price increases by telcos concerns watchdog

In the space of a few weeks, the three main telcos in Spain have increased their prices, causing concern from the market and competition authority.

The president of the Comisión Nacional de los Mercados y la Competencia, José María Marín Quemada, has stated that it is closely monitoring the market situation now that Telefónica, Vodafone and Orange increased the prices of all their convergent packages and services, including pay-TV.

The telcos have decided to increase fees because of customer demand for improved services, arguing that customers demand more premium packages. Speaking to Europa Press, Quemada stated that the CNMC is analysing whether users were actually demanding the improvements.

According to the official, it would be more reasonable to offer upgraded options to customers, rather than automatically raising prices.

The move by the operators comes after years of strong competition, which drove falling prices for telecoms services, with Vodafone being the latest to increase its charges.

The increase also comes with increasing market concentration. Excluding specific regional cases, the three telcos own most of the telecoms market. Telefónica, which completed the acquisition of Canal+ in 2015, controls the pay-TV market, while Vodafone and Orange have gained even stronger positions in the telecom sector.

Market concentration has been defended before by the CNMC as essential for improved services, especially regarding the pay-TV boom over the last two years.

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