Telefónica will cease to be the obliged universal service operator: CNMC reports favourably on the draft Order

The Spanish National Markets and Competition Commission (CNMC) has reported favourably on the draft Order ending Telefónica's designation as the operator obliged to provide the fixed internet access and fixed telephony services included in the telecommunications universal service (IPN/CNMC/048/26). The proposal, drawn up by the Secretary of State for Telecommunications and Digital Infrastructures, starts from a finding: both services are already widely available through existing market offers, so it is no longer necessary to designate a specific operator to guarantee their provision.

The report, released on 5 November 2026, represents a relevant step in adapting telecommunications regulation to the reality of the Spanish market, and is accompanied by a warning: the CNMC recalls the importance of approving the new universal service Regulation before the end of 2026.

What the universal service is and what changes

The universal service guarantees that certain basic electronic communications services are available to all citizens, regardless of where they live, with adequate quality and at an affordable price. It is a public policy instrument with a European foundation —Directive (EU) 2018/1972, establishing the European Electronic Communications Code— transposed into the Spanish legal system by the General Telecommunications Act, whose logic is to correct market failures: where provision is not profitable for operators, the State guarantees it by designating an obliged company. The Act itself allows an operator to cease to be required to provide these services when the market already offers them by itself under adequate conditions.

The CNMC stresses that this does not mean the disappearance of the universal service, which remains a legally guaranteed right of users. If at any point the market were to stop ensuring access to these services, their provision could be tendered again or the obligation imposed on an operator. The change is therefore one of mechanism, not of right: from designating an obliged operator to trusting the competitive offer, with supervision.

Why now: a mature market

The CNMC considers the proposal coherent with the sector's evolution in Spain. In previous reports it had already highlighted the high level of coverage of fixed and mobile networks, the availability of satellite services and the effect of public programmes supporting the deployment of digital infrastructures. In that context, maintaining Telefónica's designation would impose public service obligations that the market makes unnecessary, contrary to the principle of proportionality.

The measure adapts, in short, regulation to the current reality of the market. It is a structural argument well known in regulatory law: obligations imposed on an operator must be reviewed when competition conditions change, and prolonging them without need distorts equality between operators, since the designated operator bears burdens its competitors do not have. The principle of proportionality, which governs administrative intervention in the market, requires periodically reviewing whether the public aim —universal coverage— still requires the most burdensome means —individual designation— or can be achieved with less intense instruments, such as general sectoral obligations and the continued supervision the CNMC itself calls for in its report.

The net cost and compensation: the account being closed

One of the classic arguments for maintaining universal service designations is their financing: when provision in certain areas or to certain groups generates an unfair net burden for the designated operator, the cost is compensated with sector contributions through the Universal Service Fund. The end of the designation also eliminates that compensatory mechanism, which simplifies the regulatory architecture, but shifts the protection of the affected groups to other instruments —social tariffs, mandatory affordable offers, direct aid— whose effectiveness remains under the watch of the CNMC and the Ministry.

Protection of vulnerable users is maintained

The report devotes specific attention to affordability. The legislation obliges all operators providing fixed internet access and fixed telephony services to offer conditions adapted to vulnerable groups, and the proposal provides for maintaining the social tariff for those who are already beneficiaries of this measure. Thus, the end of Telefónica's designation does not affect the continuity of these support mechanisms.

The CNMC's observations

Although the overall assessment is favourable, the CNMC makes two warnings that frame the change:

• Continued supervision: it highlights the importance of continuing to supervise the availability of these services for all consumers in Spain, regardless of their geographical location, in case additional measures need to be analysed.
• New Regulation before year-end: it recalls the importance of approving the new universal service Regulation before 31 December 2026, as an essential piece for the correct application of the new regulatory framework.

The second observation has special practical weight: the end of the designation leaves a scenario in which guarantees will rest on the market and on general obligations, and the Regulation is the instrument that must articulate that transition without protection gaps.

Reading for operators and their advisers

The end of a universal service designation has concrete contractual and regulatory consequences: the obligation to provide the service under the conditions imposed by the designation ceases, the associated regulated price reference disappears and a transition period opens in which the protection of affected users depends on the safeguards fixed by the resolution. For alternative operators, the withdrawal of obligations from the designated operator is both a signal of market maturity and a commercial opportunity in the segments left without mandatory coverage. And for the Administration, it is the starting point of subsequent supervision: deregulation does not extinguish the CNMC's vigilance over the real conditions of provision.

What follows and why it matters to the legal sector

The draft Order will continue its processing until its approval by the Government. For operators, the change redefines regulatory obligations that had been linked to Telefónica's designation for years; for firms advising companies in the sector —and for the operators' own lawyers— attention now shifts to the new universal service Regulation, whose content will determine the effective guarantees of the right in the new stage. Supervision of the wholesale and retail telecommunications market remains, moreover, one of the CNMC's most active fronts, as shown by the sanctioning proceedings opened against Lyntia Networks over the commitments of the Iberdrola fibre purchase.

Frequently asked questions

What has the CNMC reported on?

Favourably, on the draft Order ending Telefónica's designation as the operator obliged to provide the universal service's fixed internet access and fixed telephony (IPN/CNMC/048/26).

Does the universal service disappear?

No. It remains a users' right; what disappears is the designation of an obliged operator, because the market already guarantees the services. If the market were to stop doing so, it could be tendered or imposed again.

What happens to the social tariff?

It is maintained for those who are already beneficiaries, and the legislation obliges all operators to offer conditions adapted to vulnerable groups.

What deadline does the CNMC set for the new Regulation?

It asks for the new universal service Regulation to be approved before 31 December 2026.

Why can the designation be ended?

Because the General Telecommunications Act allows it when the market already offers the services by itself under adequate conditions, as attested by network coverage and the existing offer.

Sources

• CNMC: "Telefónica dejará de ser el prestador del servicio universal" (5-11-2026)