The European Commission is drafting a set of new regulations aimed at ensuring fair competition among high-speed internet providers during the transition period to a fully competitive market.
The draft recommendation would strive to put the cable companies on equal footing with the incumbent telecommunications companies, and would give national regulators the power to establish whether specific individual companies are dominant or not.
Under the current regulations, only those telcos are subject to special rules that had enjoyed public monopoly status prior to the liberalisation of the market in 1998. According to the Commission, these companies were potential early entrants in the broadband internet access market, and could have abused their advantage through predatory pricing. According to Commission figures, 6.34 million out of a total 10.8 million subscribers to high-speed internet services are currently connected via the incumbent telecommuncations companies.
As a result of the planned regulations, the cable companies - many of which are experiencing financial difficulties today - will find themselves subjected to similar restrictions which the incumbent telcos have been protesting against.
The Commission believes its "ex ante" regulations will be applicable in a potential future situation when the cable companies rival the telcos' lead. The aim of the proposal is to take pre-emptive action before the pendulum swings. Eventually, however, these rules will be overridden by the emerging competitive marketplace. In the long run, the Commission believes that regulations shoud be based on technology neutrality to enable users to benefit from market competition.