Euronews: Telcos Should Eat Each Other

Neelie Kroes, KPN Telecom NV (NYSE: KPN), Telefónica Deutschland GmbH and eir get in line for today's roll-call of EMEA headlines.

  • Neelie Kroes, the European Commission 's vice president for the Digital Agenda, may have raised a few eyebrows with her latest proclamation at a conference on Monday: Reuters reports that famed antitrust fiend "Steely" Neelie expressed her support for consolidation among European telcos, saying that having just a few pan-European operators that are strong in the cross-border market "would not necessarily be bad for competition," and would indeed help speed up fiber rollouts in the region. (See Steely Neelie's FTTX Face Off and Brakes Stuck on Europe's FTTH Ride.)

  • And talking of consolidation, a noted antitrust lawyer has said that the proposed merger of KPN's German unit, E-Plus Service GmbH & Co. KG , with Telefónica Deutschland could face lengthy regulatory scrutiny, reports Bloomberg. The merger is being considered as a defensive measure by KPN against Carlos Slim's América Móvil S.A. de C.V. , which is looking to take control of the Dutch incumbent. (See Euronews: Slim Makes His Move on KPN and Slim's Dutch Drama .)

  • And talking of the European Commission... The EC has given its blessing to €6 million ($7.6 million) of public financing towards the construction of a fiber-based broadband network in the U.K. city of Birmingham, noting that it is "in line with EU state aid rules, in particular because it will be genuinely open to all operators and will therefore promote competition."

  • Elsewhere on the Slim-versus-KPN front, Reuters reports that the billionaire is piling the pressure on KPN by buying more of the Dutch telco's stock at a lower price than he had just offered for up to 27.7 percent of the company. América Móvil's holding in KPN now stands at 7 percent.

  • Irish incumbent eircom has moved out of examinership (a process akin to administration) and is now in the hands of the senior lenders, according to the Irish Times. In its new form, Eircom Holdings (Ireland) Limited, it is carrying 40 percent less debt than it was before. (See Lenders to Lean on Eircom.)

    — Paul Rainford, Assistant Editor, Europe, Light Reading

  • Michelle Donegan 12/5/2012 | 5:30:36 PM
    re: Euronews: Telcos Should Eat Each Other

    How does Kroes's vision work here? Is she talking about having a few big wholesale network operators in the EU that deploy and operate the networks, and then competing service providers use those networks? Operators seem to be heading in that direction with network sharing deals for LTE.

    But ultimately, with less competition and fewer players in a market, doesn't that mean our prices would go up? 

    Anne Morris 12/5/2012 | 5:30:26 PM
    re: Euronews: Telcos Should Eat Each Other

    ...and the EU is not always known for its light-touch regulation on mergers! Fewer networks and more service providers would surely be the approach she means though; and therefore pool network investments like the LTE operators are doing.

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