France Telecom CEO Richard rages at EC over hints of collusion

France Telecom (FT) CEO Stéphane Richard has hit back at the suggestion made by the European Commission (EC) that FT and four other major European telcos were colluding on standardisation matters.

Richard

"There is nothing more transparent than these meetings. I find it scandalous that today someone dares to demand an account of these meetings," Richard told Dow Jones Newswires after speaking at a conference on globalisation at the Finance Ministry in Paris.

This outburst came after the European regulator contacted Deutsche Telekom, France Telecom, Telefónica, Vodafone, Telecom Italia and the GSMA regarding meetings that had been held to discuss market development in the European Union. Richard said the EC was informed about the meetings prior to them taking place, a lawyer was present, and the five telcos involved, known as the E5 group, gave a precise account to the EC afterwards.

"What more do you want us to do?" Richard said.

While other telco execs have also voiced their astonishment to the EC's request for more information on what took place at the E5 meeting, the Financial Times reported that those with knowledge of the process say that EC competition authorities must feel something might be askew if they need additional information beyond that which has already been submitted by the E5 group.

According to the report, EC officials do not routinely issue information requests in response to all complaints.

The Financial Times report also points to growing anger among senior telco execs over the lack of active EC participation in tackling the fall-off of voice and text messaging revenues and the need to make high capital expenditure investments in infrastructure to cope with rising data demands.

Commenting on the EC's interest in the E5 meetings, Robin Bienenstock, analyst at Bernstein, described the probe as "part of the escalating war of words between the EU regulator and the operators, and the increasing enmity between the two sides."

In what might be an attempt to quell the backlash from the E5 group, the EC, according to Euro Politics, stated: "The Commission has not opened formal proceedings. These fact-finding steps do not mean that we have competition concerns at this stage, nor do they prejudge the follow-up."

For more:
- see this Dow Jones Newswires article (sub. req.)
- see this Financial Times article (reg. req.)
- see this Euro Politics article

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