Brussels, 28/11/2001 (Agence Europe) - In the run-up to the Telecoms Council on 6/7 December that will be focussing on the new European regulatory framework proposed for the telecoms industry, the European Commission adopted a Communication on Wednesday on the state of implementation by EU Member States of the current European regulatory framework for telecommunications. The key conclusion is that against a generally pessimistic background, the telecom services sector is buoyant, the national regulatory authorities continue to make progress with liberalisation, but a number of regulatory bottlenecks remain. Presenting the Report, Erkki Liikanen, Commissioner for the Information Society said that the Commission would be launching infringement proceedings against various Member States on 20 December.
The success of this new framework depends on the full and coherent implementation of the current EU rules on harmonisation and liberalisation of telecommunications. This Report adopted on Wednesday demonstrates that implementation of these rules has contributed so far to the growth in the sector over the last few years, and that competition has continued to encourage lower tariffs, greater choice and more advanced services. The combined EU market will expand to an estimated EUR 218 billion in terms of revenue by end 2001, representing growth of 9.5%. The fastest expanding segment is again mobile services, with revenue growth of an estimated 22.3% and 36% more subscribers this year, and with an average penetration rate of 73% in August 2001. In terms of choice, the population of twelve Member States can now choose between more than five operators for long distance and international calls. For local calls, in six Member States the whole population has a choice of more than five operators, with a rapid increase in the use of carrier pre-selection, in addition to the heavy use already made of carrier selection via access codes. When it comes to price, competition between operators is bringing prices down overall. Incumbents' long distance calls are down 11% in price since last year and down 45% since 1998 for a three-minute call in Europe, and by 14% since last year and 47% since 1998 for a ten-minute call. This trend does not apply, however, to local calls. Another positive point noted in the Report: the average level of internet penetration in EU households was around 36% in June 2001.
The Report is less optimistic vis-à-vis the "essential priority" area of local loop unbundling, which has been obligatory since January. The number of unbundling agreements varies widely across the Member States and the number of lines actually unbundled is still relatively small (just over 640,000) with shared access to the local loop only being available in four Member States (Belgium, Denmark, Finland and Sweden), and the number of lines is limited to a few hundred. This means that 11 Member States may be the subject of the infringement proceedings announced by Mr Liikanen. The Report expresses concerns that incumbents are continuing to develop their own broadband services (especially DSL) in the absence of effective competition. For the situation to change, the Report stresses that national regulators need to provide hands-on monitoring and set binding deadlines with credible penalties. Regulators also need to act to ensure that wholesale DSL is offered to new entrants on non-discriminatory terms. The other regulatory bottlenecks identified in the Report include interconnection, including the cost of terminating calls in mobile networks and the provision of flat rate interconnection for calls to the internet; continuing high prices, lengthy delivery times and absence of cost orientation for leased lines, particularly at speeds required for broadband and e-commerce rollout; persisting tariff distortions and price squeezes in certain instances; the full functioning of carrier selection and pre-selection; the disparate roll-out of rights of way; and the monitoring of consumer issues and the protection of data and consumers' interests. The Report can be consulted at: http: //europa.eu.int/information_society/topics/telecoms/implementation/index_en.htm