The CEO of MasOrange, Meinrad Spenger, has ruled out modifying the regulatory framework for passive infrastructure in Spain, understanding that there are no reasons to do so, after Telefónica sent the National Commission for Markets and Competition (CNMC) an "interested and partial" proposal to increase the cost of renting its 'ducts'.
"We now have the debate on passive infrastructure in Spain, Telefónica has made an interested and partial proposal, which is not decided, and we trust very much in the criterion, in the good criterion of the CNMC to make a decision," Spenger said during his speech at the 'DigitalES Summit' meeting.
This debate is part of the process of reviewing the regulations governing the infrastructure that Telefónica makes available to other operators. In this file, the regulator is studying the regime applicable to the use of the underground conduits and poles of the 'teleco' chaired by Marc Murtra.
In his speech, Spenger argued that "there are many reasons not to change this regulation," citing strategic, regulatory, and economic factors, and stressed that the current model "has worked so well that other countries in Europe envy Spain."
He also emphasized that 99% of the passive infrastructure market is concentrated in a single actor, which, in his opinion, is a "monopoly" that needs supervision and clear rules.
According to Telefónica's proposal, an annual increase of 17% is proposed for the next five years, which would mean a cumulative increase of 110% and would practically double the income it obtains from leasing that infrastructure to other operators, according to information advanced by Expansión.
European update on cybersecurity
Regarding the upcoming review of the European cybersecurity framework, Spenger called for it to be proportionate and pragmatic, and argued that Europe must be able to collaborate with the best actors in each field.
He also highlighted at the 'DigitalES Summit' that the Spanish market, which he described as the best connected and most competitive on the continent, has allowed MasOrange to grow in terms of customer numbers, turnover, profitability, and reputation. He added that the company leads most of the network quality 'rankings' and obtains a large part of contracts with companies and public administrations due to its technical score.
The executive has argued that the telecommunications industry must transition from a volume-based strategy to one focused on value, in a scenario where connectivity services have become an essential 'commodity'. He stressed that connectivity is already practically universal and that the challenge lies in generating added value on that basis. He pointed out that Spain has a very solid infrastructure and that the country has moved from 3G to 4G and 5G with almost universal coverage, including in rural Spain.
When asked about artificial intelligence (AI), he indicated that MasOrange starts from an advantageous position by having the largest number of customers in Spain and, therefore, more data. He detailed that the company uses AI to gain productivity, boost revenue, and improve service quality, and mentioned a digital twin of its mobile network that helps them decide where to invest.
In the area of cybersecurity, he underlined that regulation can play a key role in generating trust and warned that, without that trust, there is no investment or digital economy.
No changes in the team after the purchase of Orange
At the beginning of June, Orange completed the acquisition of the 50% of MasOrange that remained in the hands of Lorca, its partner in the 'joint venture' in Spain, for 4.25 billion euros, thus taking control of 100% of the operator's capital.
In this context, Spenger assured that no major modifications are contemplated because "neither the team, nor the culture, nor the plan they have to execute, which is clearly to invest, innovate, and grow, will change."
Creating value on top of the best connectivity
"We have to work on value, on creating it on top of basic connectivity, which is already universal and the best in Europe," Spenger indicated. The executive wondered how that value is generated and, in his opinion, it involves taking care of customers, treating them "well and without creating problems."
Spenger highlighted the role of his team as a driver to "continue and create value," emphasizing that the company can "do unique things" thanks to its position within the group, which allows it to be "the most innovative" and, at the same time, leverage lessons learned in other markets.
A very fragmented European market
Spenger has pointed out that the telecommunications sector in Europe continues to be "fragmented" and has criticized the consequences of competition regulation, recalling that a European operator has, on average, about 5 million customers, compared to 100 million in the United States and 500 million in China.
In particular, he has questioned the fragmentation and the regulatory approach, pointing out that, although European regulations have "many positive aspects," in terms of competition and 'antitrust,' "we have suffered" due to the current market structure.