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Deutsche
Telekom Asks to Raise Rivals' Fee for
Local Connection
By
Vanessa Fuhrmans at Bloomberg
News 09 June
1998
Deutsche
Telekom, Germany's dominant telephone
company, said it wants to double what it's
allowed to charge competitors for use of
its connections to homes and
businesses.
In a proposal submitted to the German
telecoms regulator, the former monopoly
asked to raise the fee
to
47.26
deutsche
marks ($26.60), from
20.65
marks
now allowed.
"It's simply way too high," said Michael
Rebstock, a spokesman for Viag Interkom
GmbH, a joint phone venture between Viag
AG, British Telecom Plc and Norway's
Telenor AS. "A price like that would make
sure there would be no competition."
Though the German phone market opened to
competition in January, Deutsche Telekom
still has an effective monopoly on local
service because it controls most
connections to homes and businesses.
Long-distance rivals such as Mannesmann
Arcor, Otelo and Viag Interkom have said
the price they have to pay to lease local
lines is crucial to determining when they
can compete in that market, too.
Mannesmann Arcor, Deutsche Telekom's
largest competitor in long distance, has
said it plans local service before the end
of the year. It said the fee should be
lower than
the
20.65
mark
cap set by the regulator until August.
The 47.26 marks Deutsche Telekom wants to
charge competitors is nearly double the
24.60
marks it charges its own customers for a
monthly local connection.
Only a few companies such as
Dusseldorf-based Isis Multimedia Net GmbH
and Net Cologne mbH currently offer local
service. Net Cologne has been billing its
customers a monthly connection fee of 24
marks, undercutting Deutsche Telekom by 60
pfennig.
Deutsche Telekom, which previously
suggested charging competitors 28.80 marks
per local connection, said the new fee
reflects the cost of providing access to
rivals. The fee should be higher than what
it charges its own customers each month,
it argued, because its costs are
higher.
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