Halting a Competitor's Mobile Network Roll-out: The Norwegian Telenor Abuse Case

The Norwegian telecoms incumbent Telenor was given a record fine of NOK 788 million (EUR 83 million) in 2018 for abusing its dominance in the Norwegian mobile markets. The abuse stemmed from a change in the pricing scheme of a national roaming agreement with Network Norway, an entrant building a third national mobile network. Telenor introduced a new fee per Network Norway customer while lowering the price per unit of traffic going through Telenor’s network. The courts concluded that the new pricing scheme made it less profitable for Network Norway to continue building its own network–and that this was Telenor’s strategic intent behind the change–implying a partial foreclosure that was harmful to competition and consumers. This paper describes the court decision and the novel form of abuse, and discusses the key economic arguments put forward by the parties. We apply a theoretical model to illustrate how Telenor’s change to the roaming contract affected Network Norway’s incentives to expand its network. Furthermore, we explain how information from the relevant market and seized internal documents from Telenor informed the economic reasoning in the case.