Brussels, 29/06/2006 (Agence Europe) - On 29 June EU Commissioner Viviane Reding, responsible for Information Society and Media, officially presented the policy options she intends to introduce for updating the framework for electronic communications. The communication is also accompanied by a draft recommendation on the markets in question, which are subject to ex-ante regulation - the number of them currently stands at 18. The Commission proposes reducing them by a third as well as subjecting the wholesale and other two markets to competition rules: the wholesale markets for access and call origination on public mobile telephone networks and the market for broadcasting transmission services. All the proposals for reform will be presented on Thursday and will undergo public consultation until the end of October. The Commission will scrupulously study the reactions that it receives before it elaborates (in connection with the framework) a legislative proposal for the end of the year, which will take effect in 2010. The adoption of a recommendation on the markets in question is also expected for the end of the year and will take effect immediately.
Speaking about the update of the framework, Ms Reding said that, above all, she did not want a change in philosophy underpinning the European rules that aim to open up the markets, and the final objective was the gradual abolition of specific regulation in competitive sectors. The Commission is pleased that significant progress has been achieved since 2002 in the opening up of the national markets to competition. This view is based on an assessment report published in February but progress is still lacking in essential markets like broad band, which explains why Commissioner Reding has told current operators to not grant any “regulatory holidays: regulation will remain in place” until all markets enjoy effective competition”. Monitoring of the markets, which currently falls to the national authorities of the EU25, are obliged to report to the Commission and submit proposals for solving competition problems. In an effort to reduce the lengthy procedures and make them less bureaucratic and fastidious, the Commission is proposing the implementation of a European regulator in charge of overseeing the national authorities and which will be modelled on the European Central Bank. Another option will be to submit proposals to national regulators for immediate application of solutions. The Commission is planning to simplify notification procedures for monitoring certain markets.
More news: based on the principle that most current technological applications (cordless) are reliant on radio-electric spectrums, which is currently managed in a very haphazard way, and that the transition from analogue transmissions to digital will free up frequencies, the Commission is planning to develop a genuine European spectrum management policy with a more systematic application of common rules valid throughout Europe - a policy which is already successfully applied in the US. The Commission is proposing the creation of a “European Radio-Electric Spectrum Agency” that would enable Europe to fully benefit from this precious source and therefore avoid individual and sometimes contradictory management in the 25 Member States. Commission Reding has also launched another option for action: the structural separation of telecom operators. Viviane Reding stressed that European rules are not currently planning on this but that the United Kingdom, which had this system to a limited extent, found the experience positive. Asked about how “realistic” such an option would be, the Commissioner emphasised that nothing had so far been decided and that consultation procedures would allow her to develop a more precise idea about envisaging such a split.
Drawing up the balance sheet for the four years of applying the regulatory framework, the Commission is pleased: 2005: €45 bn of investment in Europe - an increase of around 6% compared to 2004. the Commission said that competition is the main driving force for encouraging fixed and mobile phone operators to invest in new technologies and services. Ms Reding said that countries that apply these rules rapidly are those which have most investment, when those who do not apply these rules or do so insufficiently achieve more mediocre figures.
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The European Telecommunications Network Operators' Association (ETNO) does not at all appreciate the initiatives of the Commission as, it says, they will continue to inhibit investment. It also considers the planned deregulation initiatives far too timid. Its arguments are based on a British study, “Indepen”, a consultancy firm which questions the conclusions of the studies carried out by the Commission and by the new operators (ECTA association) as, it says, they omit certain factors while making generalisations, thus warping the results. The Commission highlights the obvious links between application of the European legislation, investment and high output penetration: better application of the European rules would make it possible to increase investment and extend broad band lines. According to ETNO, the studies do not take into account the specific features of the 18 markets, on one hand, and confuse different types of competition that have different impacts on investment and broad band, on the other. “It is important for all evidence available to be rigorously assessed and for confidence not to be given to certain studies simply because they support a preconceived idea”, stressed Michael Bartholomew. In an interview with La Tribune, the director of ETNO states that competition today is sufficient and calls on Brussels to stop imposing it on the largest operators in a regulatory manner. The proposal to divide the activities of the traditional operators in order to isolate the management of their networks and to open them up more to competition would, according to Mr Bartholomew, be the contrary to investment incentives as the new entrants would not invest more, benefiting from investment from the main operators. The Commission proposal, however, smiles on the new operators (ECTA - European Competitive Telecommunications Association) which considers that such procedure would encourage competition. ECTA is also pleased with the clear position set out by Ms Reding concerning “regulatory holidays”, allowing historic operators to free themselves of all obligations as long as they improve the network. The association is also in favour of a new policy for spectrum management. ECTA, on the other hand, expresses more reservation about the reduction in the number of certain markets subject to ex-ante rules. Liberalisation is premature for some sectors, she says.