Bulgaria's Vivacom plans to appeal fine over tablet PC subsidies

Bulgarian Telecommunications Company (BTC), which trades under the Vivacom brand, said it will appeal a fine issued by the country's Commission for Protection of Competition (CPC) related to the way the operator sells bundled services.

The CPC yesterday issued a fine of BGN812,000 (€415,203/$472,234) against BTC after ruling the operator was unfairly impacting competition in Bulgaria by offering heavily subsidised tablet PCs to consumers signing up to new data contracts, the Sofia Globe reported.

In a statement emailed to FierceWireless:Europe, a BTC spokesman said the company disagrees with the ruling and plans to appeal. The operator has 14 days to make its appeal, the Sofia Globe noted.

BTC told FW:E that the CPC decision "deprives Bulgarian consumers from accessing tablets at reasonable prices," and "prohibits one of the biggest advantages of a bundled offering--combining devices with subscription plans at affordable prices."

Bulgarian cable operators had complained about the low-priced tablets to the CPC, which investigated BTC during the first seven months of 2014 and based its fine on the operator's 2013 revenues, the Sofia Globe reported.

However, the BTC spokesman said subsidising devices has been normal practice among the country's operators for several years, as well as within the wider European Union. "The company wishes to continue this positive and customer-oriented practice. Therefore, we will appeal the fine at the Supreme Administrative Court."

BTC competes against big names including Mobitel (owned by Telekom Austria) and Telenor Bulgaria in the fiercely competitive Bulgarian mobile market.

Telekom Austria's recent 2014 earnings figures highlight the competitive nature of the Bulgarian market. The operator achieved a marginal 0.9 per cent increase in mobile users compared to 2013, and saw fixed line subscribers decline 3.9 per cent year on year.

The operator noted the market was affected by "pronounced macroeconomic pressure and an uncertain political situation" through 2014. Telekom Austria was also forced to book an impairment charge of €400 million ($454 million) last year on its Mobitel business following an adjustment to its medium-term outlook for the subsidiary.

Telenor reported a drop in its Bulgarian subscriber numbers year-on-year in the fourth quarter of 2014, noting that "intense competition throughout the quarter" resulted in the loss of 146,000 subscribers in the recent quarter compared to the same period of 2013.

The operator re-branded its Bulgarian business in November, some 16 months after acquiring the business--then named Globul--from Greek operator OTE.

For more:
- view this Sofia Globe report
- see Telekom Austria's earnings statement
- read Telenor's earnings announcement

Related Articles:
Telekom Austria swings to 2014 net loss, sees growth in 2015
Telenor Group earnings growth not enough for analysts, stock market
OTE sells Bulgarian unit to Telenor for €717M
Telekom Austria cuts 2014 outlook, posts H1 loss on Bulgaria writedown
Bosnia's Telekom Srpske plans Austrian MVNO

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