Court upholds penalty against France Telecom unit

A European Union court upheld a 10 million euros ($13 million) antitrust fine on France Telecom's Internet arm Wanadoo, saying the company abused its position to undercut rivals offering high-speed Internet services in an attempt to monopolize the market, an Associated Press report said.

The Associated Press report said EU regulators fined Wanadoo in 2003 after finding that it charged 'predatory prices' that did not cover its own costs as part of a plan to take control of the high-speed market in its early stages.

Wanadoo challenged this ruling, claiming there was nothing wrong with its pricing and it did not have a monopoly-type position in the fast-growing Internet market, the report said.

The court said pricing below costs gave grounds to assume that prices are designed to kill off rivals, it said.

It also rejected Wanadoo's claim that it did not control the market, saying it had a very high market share, eight times more ADSL subscribers than its next rival, the report further said.

France Telecom took over Wanadoo in September 2004, buying out the 30% of the unit it did not own. France is the biggest broadband market in Europe, even outpacing the EU's largest economy, Germany, the report further said.