ECTA Urges Euro Telecom Rethink

LONDON -- ECTA, the European Competitive Telecommunications Association, has called on the European Commission to thoroughly review its thinking on universal service to promote a more competition-driven approach to meeting consumer needs. In its response to the Commission's Review of the scope of universal service, ECTA suggests that, in future, if regulators put in place strong mechanisms to promote competition such as 'access', we can move from the current situation, where the incumbent is expected to deliver universal service, to one where operators compete to offer a wide variety of voice and Internet services to consumers.

An important aspect of universal service for Governments and the EU as a whole is protecting against a digital divide and ensuring that consumers in rural and remote communities can access services at affordable prices. At present, this is often achieved through requiring incumbents to charge the same retail price to consumers across the country. However, this can mean that rural customers are reliant on the incumbent for service. "One way of addressing the digital divide without depriving rural communities of choice, is for the incumbent to provide wholesale access to competing operators at a geographically averaged price," says Roger Wilson, Managing Director of ECTA. "This will enable telecoms operators to offer a range of services at uniform prices nationwide, and will also ensure that any pricing pressure that incumbents face in cities will be transmitted to rural areas."

ECTA recognises that competition alone is unlikely to provide an answer for all universal service issues - in particular providing for the needs of the disabled and those who are unable to afford even a nationally averaged competitive price. "Governments will need specific solutions to cater for consumers such as these, but there is still scope for them to make obligations more neutral so that choice and competition can play a greater role," says Roger Wilson.

In its response, ECTA also raises the important question of how voice over IP (VoIP) should be handled in the context of a forward-looking universal service regime. In the future, customers will increasingly be switching to VoIP from traditional switched technologies, so European institutions and regulators should have a clear vision as to how this will affect the concept of basic services and any rules about directories.

Overall, ECTA concludes that there is a real opportunity at this time, with the forthcoming review of the Regulatory Framework to set a new pro-competitive agenda for the delivery of universal service, and to focus Governments' attention on a narrower set of issues where there is a genuine need for social intervention.

European Competitive Telecommunications Association (ECTA)