ETNO Challenges EU

CEOs of leading EU telecom operators call for right balance between regulation and market forces

November 26, 2007

3 Min Read

BRUSSELS, Belgium -- More than 300 experts from the e-communications industry, EU institutions, economists and member states discussed future challenges of the telecoms sector and held a first debate on the Commission proposals for the review of the EU telecoms rules, on the occasion of ETNO’s 5th Annual Conference.

Chief Executive Officers of leading EU telecoms operators called on EU policy makers to focus on how to encourage private investment in high-speed broadband access networks as new services and growing number of users require increasing bandwidth capacity. CEOs regretted that the proposals for the review, by focusing mainly on functional separation, missed the opportunity for the deployment of next generation access networks.

Speaking at the conference Mr. Bojan Dremelj, President of the Management Board of Telekom Slovenije, raised a number of serious questions regarding the direction where regulation is going and stated: “There is no need for overregulation which will reduce all of us to a ‘grey average’. How can we ever become the most competitive economy in the world if we are stifling innovation? If we cut the wings of our big players, aren’t we cutting the ‘branch on which we are sitting’? Is this what Europe is aiming for?”

ETNO members welcomed the proposal by the European Commission for a more flexible management of radio spectrum to boost the deployment of wireless applications. They also noted the reduction in the number of markets to be subject to regulatory intervention but regretted that at the same time the European Commission is extending regulatory intervention to new technology, including risky fibre-based broadband access networks.

In his keynote address, Didier Bellens, CEO of Belgacom: “By making new network capacity available, telecom operators contribute in many other fields, including the medical sector, traffic management, electronic payment, telesurveillance, and the management of energy usage. What are citizens and companies in Europe asking for? They want to have these services and products at their disposal, which require increasingly powerful access networks. And to develop these networks, operators need more freedom, not regulations”.

ETNO calls for the introduction of a sunset clause as a concrete way to reaffirm the transitory character of the framework and stimulate all players to deploy new and alternative access infrastructure.

ETNO insisted that the new regulatory approach should be flexible enough to reflect local competitive realities. EU policy makers should also consider alternatives such as sharing obligations for all ducts as means to facilitate investment in new networks.

Rudolf Fischer, CEO Telekom Austria TA AG, said at the ETNO conference: “Creating sustainable competition requires both equal treatment in different technologies and regulatory decisions that take into account regional differences. "No changes to the framework" or even calling for more regulation - as proposed by the Commission - is definitely no solution to address the investment backlog we're currently experiencing in Europe due to regulatory uncertainties. We need a regulatory framework that reassures investors”, said Mr Fischer.

ETNO reiterated that the introduction of a new remedy such as functional separation is not needed to achieve competition as current tools have already led to open competition and consistently increasing broadband take up throughout the EU. Most importantly, functional separation represents a shift from a transitory market-driven approach to a model based on a permanent regulatory approach and a utility conception of the telecoms sector.

"Rapid technological developments create multiple opportunities for consumers to access broadband services. Competition between networks and platforms should remain the key priority as it is the best way to encourage innovation and consumer choice”, said Michael Bartholomew, ETNO Director.

European Telecommunications Network Operators' Association (ETNO)

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