SPECIAL REPORT / Europe's Commissioner for the digital agenda, Neelie Kroes, called yesterday (26 February) for a true single market in telecommunications to overcome sluggish spectrum sales by EU member states and to prevent governments pocketing the cash proceeds. EurActiv reports from the GSMA conference in Barcelona.

In a speech to Barcelona’s Global Mobile Congress – the world’s largest telecoms sector conference – Kroes said the 27 EU states needed to align their approach on mobile spectrum and fibre broadband, creating a genuine single market.

Speaking to journalists afterwards, Kroes described Europe’s poor efforts to release broadband spectrum as resembling “a bowl of spaghetti”, adding that countries risked an "ACTA-times-ten" backlash.

Kroes was referring to the controversial Anti-Counterfeiting Trade Agreement, which met with strong public opposition.



Unallocated broadband spectrum is ‘inexcusable’

The EU has authorised 1,200 megahertz of spectrum for wireless broadband, but on average European member states have only granted 65% of it.

Kroes described this as an “inexcusable waste” and said that the Commission was prepared to use treaty powers to bring actions for infringement against member states dragging their feet. She also condemned EU governments for auctioning broadband spectrum without any intention of spending the proceeds of such auctions on digital services.

Kroes said that Europe was “shooting itself in the foot”, since spectrum revenues were needed to invest in 5th generation broadband networks.

Governments failing to invest spectrum proceeds properly cause networks to deteriorate they "will face defeat at the ballot box" as a result, Kroes said, adding: “The opposition will be like ACTA times ten if they do not do this.”

Spectrum is politically sensitive

Kroes's call for a single market will be most politically sensitive insofar as it suggests a single regulator could replace the national authorities, which jealously guard their right to preserve spectrum as a sovereign asset, often for defence and security purposes.

Kroes has not publicly called for the creation of a single regulator, but she told journalists that it was possible that in the future the EU could be solely responsible for auctioning European spectrum.

France, Germany and Britain are known to oppose ceding power to Brussels on telecommunications regulation, especially if it means losing control of spectrum auctions that bring billions into public coffers.

Need for consolidation in telecommunications market

The industry broadly welcomed Kroes’ announcement. "We back in principle the idea to have a much more integrated European telecoms market but we see a real need to have a real consolidation because there are too many markets and too many players," said Luigi Gambardella, the chairman of the European Telecommunications Network Operators' Association (ETNO), which represents 37 companies.

Europe has about 100 mobile operators, set against six in the United States and three in China, making for a much more fragmented market. European companies have also been struggling to pay off debts and build 4G and fibre broadband.

Consolidation to reduce the number of mobile operators has been viewed with suspicion by antitrust regulators in Brussels over fears that it leads to higher prices. Gambardella said he believed they now understood that a more consolidated market would be vital for a genuine single market.