MEPs shift focus of telecoms review

"Today telecoms make up a large part of EU growth, with 250 million Europeans connected to the Internet. However access is still not optimal everywhere," said MEP Catherine Trautmann (PES, FR), in charge of the Parliament report on the regulatory framework. For this reason "we absolutely want the telecoms package to be decided before the end of the term".

MEP Pilar del Castillo Vera (EPP, ES), Parliament rapporteur on the new Telecoms Authority, clearly rejected the Commission's plan: "The new body would have three fundamental problems. It would end up creating a very large bureaucracy; it would pose a threat to the principle of subsidiarity; it would send a contradictory signal against the general desire to move from ex-ante regulation to a fully competitive market."

Martin Selmayr, spokesperson for Information Society Commissioner Viviane Reding, diplomatically replied: "The intended upgrade of the ERG to a more efficient, more independent and more transparent Community body (whatever its name) is a very welcome positive development, even though further work will be required to ensure that the legal framework and the financing of the new body will be fully compatible with European Community law."

He also added: "We regret the lack of ambition as regards the reform of spectrum management. In this respect, we hope that the months to come will further clarify the need to give Europe's wireless industry better access to radio spectrum for new services and to ensure that all EU citizens are covered by broadband."

The incumbent operators' reaction was represented by European Telecoms Network Operators' Association (ETNO) Director Michael Bartholomew: "By placing the next generation networks and the risky investment they entail at the top of the review agenda, Trautmann's report represents a significant shift from the initial Commission proposals, even if more could still be done to encourage NGN investment," he said, also welcoming Parliament's proposals on geographical segmentation.

On the other hand, "ETNO remains convinced that functional separation is not appropriate for today's market and could act as a deterrent to investment," added Bartholomew.

Ilsa Godlovitch, the European Competitive Telecoms Association's (ECTA) director of regulatory affairs, commented on behalf of the alternative telecoms operators: "An important principle put forward by Catherine Trautmann is that operators should share infrastructure to justify the expense of rolling out fibre access lines. We are encouraged by these signals. However, we are concerned about some contradictory aspects of the proposal, which suggest that duplicating lines rather than sharing them should be the preferred approach. We find the idea that customers would want to pay more for to have multiple telephone lines from different providers going into their house unrealistic and unlikely to gain the backing of financiers," she said.

The proposal on geographical segmentation was considered by Godlovitch to be a measure "likely to increase red tape and raise prices, in particular for rural customers". "The UK was the first in Europe to try this approach, but the decision to segment broadband markets will not be fully in force until 2009 so it is too early to see what effect it will have. We do know that New Zealand tried it in the past, but has since moved towards a more unified national approach," she commented.