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It’s not time to rock the boat – Competition key for consumers and to secure network investments

Date

13 Feb 2014

Sections

Innovation & Enterprise
Recommendations of the study on the Future of Regulation and the review of Relevant Markets

Brussels, 12 February 2014: The European pro-competitive framework has helped dismantle the monopolies of the old state owned telecom companies by granting new entrants access to economic bottlenecks and enabling waves of product innovation and levels of consumer welfare not imagined before. This has made the European broadband story, like that of European telecommunications generally, one of success. European consumers and businesses enjoy competitive offers at affordable prices and ever increasing speeds. Yet powerful former monopolies remain dominant in the wholesale markets. Regulation remains essential to ensure that the competitive gains and consumer welfare achieved so far are not reversed, particularly in the transition to Next Generation fibre Access Networks (NGA).  This speaks in favour of limited changes to the list of markets regulated ex-ante and to maintaining the European pro-competitive regulatory model as a whole, alongside the vigorous implementation of the framework´s regulatory tools.  

These are the recommendations of a study released today by Webb Henderson and SPC Network, which aims at contributing to the debate on the future of European regulation and the review of relevant markets. This study presents an empirically based assessment of the progress of competition and the interplay between market developments and regulation.

Tom Ruhan, Chairman of ECTA said “This study shows that there is no case for an extensive overhaul of the current regulatory framework. Let’s separate myth from reality - Europe is on track, alive and kicking. We are among the global leaders in broadband performance and our network investments are progressing at a steady pace. So why change a regime that is working well? I say: ‘review’ yes, ‘overhaul’ no.”

Erzsebet Fitori, Director of ECTA said “It’s not time to rock the boat. The key bottlenecks of today are those of yesterday and will be those of tomorrow. More than ever we need fit-for-purpose wholesale access products made consistently available from dominant operators in each and every Member State, at a fair price, so that new entrants can continue climbing the ladder of investment, rolling out NGA networks, innovating and competing vigorously in the fast and ultra-fast broadband space. The European Commission and National Regulatory Authorities have the tools to do it - they just need to put them to full use.”

The European Commission is currently revising the list of markets subject to ex-ante regulation, i.e. those markets whose particular characteristics require a “push” towards competition. The markets currently included in the list have been repeatedly (typically in 3-year review cycles) considered non-competitive and thus regulated by the vast majority of the National Regulatory Authorities in Europe, and there is no compelling evidence that regulation is no longer warranted.

The periodic review of the regulatory framework also is on the horizon. The review presents the European Commission and the co-legislators with the opportunity to adapt and apply the framework to an ever-changing regulatory landscape. There are existing “regulatory tools” that remain unused, such as functional or other forms of effective separation of recidivist vertically integrated providers, and concepts worthy of robust application such as joint dominance. It is imperative to ensure that the infrastructure competition model is not put at risk by the commercial tactics of dominant operators. Above all, the review presents the opportunity to re-affirm the key role of competition going forward.   

The Full Report can be found here.

The Executive Summary can be found here.

ECTA (the European Competitive Telecommunications Association - www.ectaportal.com) is the pan-European pro-competitive trade association that represents more than 100 of the leading challenger telecoms operators across Europe. For over a decade, ECTA has been supporting the regulatory and commercial interests of telecoms operators, ISPs & equipment manufacturers in pursuit of a fair regulatory environment that allows all electronic communications providers to compete on level terms. Our members have been the leading innovators in Internet services, broadband, business communications, entertainment and mobile.

Contact: Inês Nolasco, Senior Regulatory Affairs Manager (+32 2 290 01 03 / inolasco@ectaportal.com).

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