OSLO, Norway-Norway’s leading operator and former telephone monopolist Telenor has suffered a series of regulatory rulings that will bite into the company’s profit margins.
The latest blow is a Norwegian Post and Telecommunications Authority (PT) decision that Telenor must lower the price it charges other operators that sell landline phone subscriptions.
The authority sided with competitor protests, despite Telenor’s argument that it charges at cost price. The PT did not agree that costs associated with fulfilling regulatory demands should be covered by those the demand was aimed to help.
Telenor has three weeks to appeal the decision or release new prices by 3 February.
The PT earlier ruled that Telenor Mobil had to allow Teletopia cheaper access to its short message service (SMS) network. The PT set a cost price of 0.30 kroners (US$0.04) per SMS message, a decision certain to spark a price war in the SMS market-operator Chess sank its SMS price by 0.10 kroners (US$0.01) within days of the announcement.
Telenor has until the end of January to appeal that ruling.
Industry analyst John Strand blasted the PT decision to regulate SMS prices in Norway. Strand told financial newspaper Dagen Naeringsliv the price drop would hurt content providers and hinder eventual investment in mobile broadband.
Strand ridiculed the PT comparison with lower prices in Denmark, saying Norway was a world leader in the SMS market while Denmark’s was the worst in Europe.
