Telekom, the third largest telecom operator from Romania, depending on income, made an announcement today that left a lot of people speechless, because it is the first of its kind from an important operator. If RCS & RDS increased the prices of services after the adoption of GEO 11/2018, those from Telekom announced that they are considering not participating in the auction for the frequencies that will be used for the launch of 5G networks in Romania.
Telekom, has this announcement made even by its CEO, Miroslav Majoros, who said that he runs a company that wants to "do business, not charity", and the conditions imposed by GEO 114/2018 could convince the company not to launch 5G. The big problem that Telekom complains about is related to the fact that through GEO 114/2018, the Government of Romania imposed that the auction for 5G frequencies should add 1 billion euros to the state budget, which is very high in comparison with other countries.
Telekom announces that it may not participate in the 5G auction
Telekom, also announced that the turnover tax imposed by GEO 114/2018 makes it uncompetitive in front of companies that do not operate in the telecom field, which is a serious problem for its activity. So two issues of GEO 114/2018 are brought into discussion, namely the tax on turnover, which not only Telekom has to pay, but also the very large amount imposed for the frequency auction for 5G networks.
We do business, not charity. The conditions deriving from the application of the provisions of GEO 114/2018 are not acceptable and we are seriously analyzing the option of not participating in the award procedure, which will be organized by the regulatory authority in the field in the second part of this year. For example, if Telekom Romania were to buy a hotel, the income generated by this investment would be taxed at 3%. Another example is IT&C projects, where telecom operators are at a disadvantage compared to IT&C integrators.
Telekom, is currently the first major operator to have a reaction of this kind, those from RCS & RDS not being so radical so far, but they have increased the prices, so they should have covered the price increase for the auction. Telekom had the courage to say what it thinks about this issue of GEO 114/2018, so it remains to be seen what Orange and Vodafone will do, which are currently in a state of waiting.
