Apr. 15, 2013

Anti-competitive practice of price discrimination in the residential mobile telephony market

By Laurent Benzoni, Pierre-Yves Deboudé and Thanh Pham-Doan

The French Competition Authority (Autorité de la concurrence) has fined Orange and SFR €180 million for their anti-competitive practice of price differentiation (Decision n°12-D-24). TERA Consultants was appointed by Bouygues Telecom, the plaintiff, to conduct economic studies for the case. The complaint focused on on-net offers by Orange and SFR that allowed subscribers to make unlimited calls to three of their contacts who also are subscribers of the same operator. The Authority approved that this practice had damaging impacts on competition. TERA Consultants undertook economic analysis at several levels: definition of relevant markets, price calculation, measurement of price differentiation, measurement of the impacts of the price discrimination practice on the operators’ subscribers and their habits and the impacts on competition and competitors.

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