Broadband Internet: Federal Administrative Court confirms COMCO decision and reduces fine

Swisscom regrets the decision made by the Federal Administrative Court and maintains that the penalty is unjustified in view of the fact that

• Swisscom does not recognise that it held a market-dominant position, as competition and price pressure on the part of cable networks already existed at the time of the investigation;
• There was no obligation to offer BBCS. The voluntary offering by Swisscom enabled its competitors to market their own broadband Internet services from the outset, however. Swisscom continually improved this service in terms of price and bandwidth, meaning it could not constitute a means of obstructing competitors;
• The investigation relates to the first few years following the launch of ADSL and the initial losses – criticised by COMCO – in broadband business as a result of new customer acquisitions were common during this period and are not open to challenge;
• Swisscom’s (end customer) broadband Internet business (as well as that of efficient competitors) is profitable over the long term and a structural deficit or margin squeeze can therefore not exist;