Restricted - Confidential Information© GSM Association 2014All GSMA meetings are conducted in full compliance with the GSMA’s anti-trust compliance policy

Competition law issues in the Internet economy – dealing with disruption

© GSM Association 2014 2

Overview

The GSM Association

Collaboration v Competition

Disruptive Competition

Disruption in the mobile industry

© GSM Association 2014

The GSM Association

3

Public Policy and AdvocacyIntelligence

Standardisation Agreements and Technical SpecificationsMobile for Development

Industry Events and AwardsJoint R&D in new and converging markets

Rapporteur

Members

Full Members:

800+ operators in

220 countries

Associate Members:

250 vendors

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Collaboration v Competition

Efficiencie

s and economies of scale

Inter-operator v external

competition

Art 101 (3)Indispensibl

e

Emerging, adjacent

and converging

markets

Market definition

s

Burden of proof and economic evidence

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Disruptive Competition

Evolution v Revolution

Inefficiencies &

opportunities

Consolidation & Merger

Control

Disrupting the

disruptors

From disruption

to dominance

Disruption and long

term investment

Role of Competition

Policy

Regulation &

Innovation

Barriers to Entry?

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Dumb Pipes or

innovative Service Providers

?

Competition or

Partnership?

Embracin

g

Innovatio

n or

Investing

in NGN?

Mobile Network Operators

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Disruption in the Mobile Industry

The smartphone era is now evolving to a digitised sharing economy where new entrants can disrupt established industries

Implications of next wave

The fourth computing era – connecting physical and digital worlds

Healthcare, Education , others… all goods and services!

Microprocessor, PC, software

Era

Driver

Co

mp

anie

s

Internet Protocols

Smartphones, APIs

APIs, Big Data, New Protocols

1980-2000PC:Revolutionised productivity

2001-2007Information age:Organised world’s information

2008-PresentSmartphones:Unbundling of comms

Disruption moves from comms to goods and services

Early examples include transport (Uber) and accommodation (AirBnB)

Growth is captured by firms that own service discovery (Uber)

Such firms leverage APIs and protocols to scale exponentially

MNOs are enabling growth through APIs and strategic partnerships rather than developing own services

Present-2020Connecting physical and digital worlds

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Connectivity Players

Cable/ISPsMNOs Converged

Option not mutually exclusive

47.7

39.4

2018

12.2

328.6

340.8

2014

8.3

Hotspot installed, millions

Community Hotspot

Commercial Hotspot

Infrastructure approach

Partnership with Wi-Fi

networks or aggregators

Hybrid Wi-Fi (network is

part owned, part in

partnership

Own/build Wi-FI

Option not mutually exclusive

Rapid Wi-Fi hotspot growth and advent of carrier grade Wi-Fi could disrupt mobile

Strategies will depend on the nature of an operator’s network and infrastructure approach

WiFi v Mobile

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Growing impact from the broader ecosystem

… plus: doubling of funding in the mobile and internet space from VCs and private equity in the last 12 months

Internet Majors Disruptive Trends Partnerships