business plan for 2004 - EDP

2003 - Annual Report - EDP
Of the various obstacles encountered, the following are
underscored in more general terms:
• Absence of structural measures to combat the joint
control of the country’s two main access networks by
the same entity and of conditions to approach best
European practices to offset the foregoing;
• Lack of fast, effective regulator response to market
needs, with no clear, quantified political objectives in
terms of real competition;
• Absence of measures to promote investment in own
networks and of simplification of access to the private
domain to install the respective infrastructures;
• Absence of a clear, open and competitive policy of
adjudicating telecommunications procurement services
by the Public Administration; and
• Indefinition of the border between the activities of the
Competition Authority and of ANACOM.
More specifically in terms of regulation, the following
constraints to the development of real competition in
general and to that of ONI Telecom in particular should
be emphasised:
• Termination tariffs in the mobile networks not oriented
to costs and discriminatory (compared with termination
of traffic from operators in other countries) with the
overall average values that are the highest of the entire
European Union;
• Interconnection tariffs with the PT Comunicações
network generally higher than the European average
and about 50% higher than best practice;
• Freeze on the dial-up Internet access interconnection
tariffs since 2002, now standing far higher than that of
the Fixed Service Telephone (SFT), thus compromising
the objective of promoting the Information Society;
• Persistence of conditions of the Disaggregated Local
Loop Offer (OLL) that are particularly serious for new
operators – loop activation prices among the highest of
the European Union and monthly charges very close to
those of the retail SFT tariff of the incumbent operator,
and continuation of inadequate or unnecessarily costly
OLL operating conditions; and
• Continuation of extremely high administrative costs in
respect of number portability (in some cases 100 times
greater than those of the majority of the countries of the
European Union).
Evolution of the Fixed Telecommunications Business
ONI maintained its strategy of a complete approach to
the domestic market through a portfolio of products and
services directed at every segment of the market,
although the conscious focus on more profitable segments
and on those with a greater capacity to retain customers
naturally occasioned a sharper growth in the more
attractive segments (companies and operators) and a
reduction of the weight of the residential segment.
Nevertheless, at the end of 2003 ONI began the launch of
an innovative, competitive service for the residential
segment with direct access via OLL – the OniPremium.
This product allies the fixed telephone service with the
broadband and releases the customer from the incumbent
operator. Given the geographic limitation to which the
service is subject, ONI has retained its traditional indirectaccess
products and services, including voice, telephone
cards and Internet.
In the corporate market, growth efforts were centred on a
large group of key customers and on the development of
alternative contact channels. ONI services directed at the
SMEs were also promoted, which constitute the greater
part of the Portuguese corporate fabric and provide the
greatest business growth potential in the medium term.
The operators segment performed well, up by about 25%
compared with the previous year, confirming ONI as a
“carrier’s carrier” within Iberia. Emphasis is given to the
fact that these results were achieved as a result of the
increase of market share in a highly competitive market
environment, with declining demand and considerable
erosion of prices.
Market Share
Fixed Telecommunications in Portugal
3.5% 2.9%
2002 2003
10.2% 10.9%
6.7% 6.8%
2002 2003 2002 2003
Residential Corporate Total
100/101