Press Release: Telecom Reform - report proposes new focus on consumer welfare and innovation
ETNO, the Association representing Europe’s main telecom operators, has published today a new report by Plum, the leading telecoms consultant. The report, “Fostering investment and competition in the broadband access markets of Europe”, considers how best to change the EU Telecoms Regulatory Framework.
Despite telecom operators' sustained investment efforts, Plum identifies a gap in investment in high-speed broadband infrastructure and concludes that the current set of rules “has played a significant role in creating an investment challenge for Europe”. A series of policy measures could be put forward to achieve long-term consumer welfare and innovative markets however.
In the report, Plum sets out a series of key principles that should shape the revised Framework, so as to stimulate investment and infrastructure-based competition in the supply of fixed broadband infrastructure.
A renewed focus on long-term consumer welfare and on assessing retail markets
Plum finds that sound regulation should be grounded on the interest of end users and on competitive outcomes in retail markets, rather than on notional wholesale markets.
For this reason, it recommends that:
- Long-term customer interest should be the single objective given to National Regulatory Authorities
- If there is effective competition in a retail market, wholesale regulation should be withdrawn
More commercial freedom for more innovation and investment
Plum also identifies regulatory principles that would stimulate market players to invest and innovate more.
For this reason it suggests that:
- Voluntary commercial agreements should be encouraged and, whenever possible, take precedence over regulated outcomes (‘ex post’ oversight by sector regulators)
- Regulation should remain technology-neutral, allowing operators to invest in the most efficient technology
- Operators who wish to do so should be allowed the freedom to switch-off of legacy networks
- Regulation should be significantly simplified and in principle be limited to one single access product
Facts & Figures
The Report also gathers a range of facts and figures. Despite sustained investment efforts, investment in fixed infrastructure in the five biggest EU member states is at $130 per line, compared with $270 per line in the US. In terms of outcomes, high-speed broadband availability is 30% lower in the EU than in the US; average broadband speeds are 20% lower; and data use is more than 50% lower.
Steven Tas, ETNO Executive Board Chair, said: “We can deliver better services to Europeans, create more growth and job opportunities by boosting the investment and innovation potential of EU telcos. Let’s be bold: the new Regulatory Framework should be simpler and promote commercial agreements as a way to create dynamic markets”.
David Lewin, Senior Partner at Plum, said: “Taken together, our proposals represent a fundamental change to the way fixed telecommunications infrastructure is regulated. If implemented they would provide the stimulus to investment and infrastructure-based competition, which the EU needs to meet the policy objectives of the Digital Single Market".Tweet