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11/12/2016

Telecoms reform passes first Parliament hurdle

Digital

Telecoms reform passes first Parliament hurdle

Telecom.jpg

A proposed shake-up of the EU telecoms sector passed its first hurdle in the European Parliament yesterday (18 March) but may stumble over 'Net Neutrality' in a final plenary vote scheduled for the beginning of April.

Lawmakers in the European Parliament’s industry committee adopted the draft telecoms reform yesterday (18 March) but braced for a showdown when the text returns to plenary for a vote in April.

The amended text maintains key elements of the 'Connected Continent' proposal originally tabled by Digital Agenda commissioner Neelie Kroes last September, including the most controversial ones on Net neutrality.

>> Read: 'Connected continent' plan seeks harmonised EU telecoms market

But despite the Parliament's efforts, the text remains unsatisfactory for most actors affected by the reform.

The European People's Party (EPP) and the Liberal Party (ALDE) supported the Commission proposal, while the Socialists and Democrats (S&D) abstained. The text passed with 30 votes in favour, 12 against, and 14 abstentions.

Net neutrality

A wide and disparate front rejected the text on Net Neutrality, arguing it fails to protect consumers from being cut off the web by Internet access providers, or from paying web services that are currently free of charge.

Consumers and industry representatives attacked the text for its provisions on Net neutrality, albeit for different reasons.

This wide front, with the support of socialists, eurosceptics and other MEPs, may derail the vote on the telecoms package scheduled on 2-3 April at the last plenary session of the European Parliament before the May Parliamentary elections.

Even in the case of a positive vote in plenary, the text will need to be negotiated with member states by the new Parliament, which will likely have a different composition and power balance than today.

The new MEPs will certainly be less keen to fight against the Council's red lines for a text produced by a different Parliament.

Uncertainty over roaming and spectrum

Political parties trumpeted their role in bringing forward the end of roaming surcharges, paid when subscribers use their mobile phones in another European country.

In fact, the Parliament voted to end roaming fees "by 15 December 2015", only two weeks ahead of the Commission's original proposal, which referred to "by 2016 or earlier".

In addition, progress proclaimed on radio spectrum is mostly cosmetic, as the text does not deal with the crucial issue of deciding which services – mobile phone or TV – should benefit from the limited frequencies available. In any case, the spectrum reform is likely to face obstruction by member states, which are unlikely to relinquish such a strategic asset.

Positions

Pilar del Castillo (European Peoples Party), a Spanish MEP who is Rapporteur on the telecoms dossier, stated after the vote: “The European Parliament has made one great step towards the consolidation of the Telecommunications Single Market. Not only has the ITRE Committee proposed to abolish retail roaming charges for voice, SMS and data by 15 December 2015, but also bring forward substantial provisions for efficient spectrum management that will allow 4G and 5G deployment throughout Europe," she said.

Catherine Trautmann, a French MEP from the Socialists and Democrats (S&D) in charge of the reform, said: “The new rules put an end to all roaming charges for calls, SMS and data, something that the S&D Group has been demanding for a long time. However, net neutrality is a red line, not only for our group but above all for citizens. There must be a more precise definition of ‘specialised services’ so that they are not confused with ‘internet access services’ and we want a binding reference to the principle of net neutrality.”

"The ALDE group is determined to abolish roaming fees. The vote is major progress. We started the work in March last year and thanks to Neelie Kroes and a majority in the European Parliament, it is now likely that we can get rid of roaming charges in the EU by the end of next year", said the Danish liberal MEP responsible for the dossier, Jens Rohde.

“We have also substantially reinforced the net neutrality elements of the Commission’s proposal to ensure that web access is as free and open as possible without hindering investment in broadband infrastructure for instance in rural areas. Those who oppose the compromise are making the ‘best’ the enemy of the ‘good’,” he added.

"This vote is great news. Digital tools and telecoms networks enable productivity and performance in every area of our lives. And now we are one step closer. This is about ensuring a dynamic, healthy, competitive telecoms sector, fit to face the future. It's about arming every European business with the tools and networks they need to innovate and grow. And giving every European citizen the seamless connectivity they have come to demand – without unfair practices like blocked services or roaming charges," commented Digital Agenda commissioner Neelie Kroes.

Luigi Gambardella, chairman of ETNO, the association of telecoms operators in Europe, was not as enthusiastic. “Today’s vote risks derailing the original objectives of the Connected Continent Regulation, as it deviates from the Commission's proposal in such a way that it will be growth-restrictive. If the restrictive changes to the Open Internet provisions are confirmed in the final text, the access of European users and businesses to our services will be affected. We are confident that the upcoming work of the EU decision makers will acknowledge such risk and will embrace the spirit of the Commission’s original proposal”.

On a similar line the comment of Nicola Frank, Head of European Affairs for the European Broadcasting Union (EBU) which represents the interests of broadcasting corporations in Europe. “The EBU welcomes the efforts of the ITRE Committee to strengthen net neutrality in Europe. However the vote falls short of safeguarding the Open Internet ahead of a crucial vote in the April Plenary. While it should be possible to offer specialised services, people’s freedom to access online content of their choice should clearly come first. Furthermore, more safeguards are needed to ensure non-discrimination between competing offers of content in the future. In this light, the role of vertically-integrated network operators also needs to be carefully examined.”

"The approved draft is more advanced than the proposal tabled by Commissioner Kroes in September 2013, a proposal which instead would have created a catastrophe for the Internet environment and the rights of citizens. However, even the proposal of Del Castillo presents numerous and relevant problems which are of concern for libertarians, pro-citizens and pro-competition stakeholders," commented Innocenzo Genna, board member of EuroISPA, the association of European Internet service providers.

"We have challenged MEPs to dump data roaming costs by 2015 and we are glad to see them give this the green light," commented Monique Goyens, head of BEUC, the pan-European consumers organisation.

"On the flipside, efforts to win a much-needed European law guaranteeing open and undistorted access to the internet have failed. Net neutrality is essential for consumers to avoid the fragmentation of the internet and stop operators from becoming economic gatekeepers by prioritising their and commercial partners’ content. Internet traffic should be neutral regardless of contract limit allowances. MEPs have let down consumers on this front," she added.

"Specifically, by failing to establish clear safeguards between ‘internet access services’ and ‘specialised services’ such as digital TV, the Parliament have allowed telecom companies to take content off the internet and sell it as a specialised service. That inevitably reduces consumer choice and affects the internet’s innovative nature,” she concluded.

Background

The European Commission proposed last September a wide reform of the telecoms sector intended to kick-start the underperforming European telecoms sector and incentivise investment in ultra-fast broadband networks.

Brussels proposed to create a real single market for telecoms in Europe, since the sector still operates largely on the basis of 28 national markets.

Under the Commission's plan, this should be achieved by ending roaming surcharges for mobile services abroad, better coordinating radio spectrum allocation, protecting the neutrality of the Internet and raising consumer protection.

Timeline

  • 2-3 April 2014: European Parliament Plenary session to vote on 'Connected Continent' package

Further Reading

European Parliament

European Commission

Press articles