Commission to use telecoms single market for battle over spectrum

spectrum

Germany's first spectrum auction in five years started today

Brussels' ambitious plan to usher in a single market for telecoms is likely to harmonise spectrum policy, a move member states are likely to resist.

A single market proposal will be put before EU leaders in October, but the European Commission is now racing to get drafts out before the end of June so that it can complete an inter-service consultation before the ideas are discussed by government leaders.

Roberto Viola, deputy director-general in DG Connect, was scathing on current spectrum policy and indicated how far the Commission intended to attempt harmonisation in its single market plans.

A 'valid passport'

“We want a valid passport for telecommunications companies to offer services and this links to having a more harmonised regulatory environment,” he told a conference on regulation in the telecoms sector on 25 April, organised by the European Telecommunications Network Operators association (ETNO).

Viola, a former secretary-general of Italy's regulator for the communication industries (Agcom), also said the EU executive would roll “concrete measures” affecting spectrum policy into the body of the single market proposals.

Originally it was foreseen that spectrum would be dealt with in a separate paper from the Commission.

“Member states are greedy on spectrum, displaying a short-term vision for the benefits of their finance ministries,” Viola explained.

“If Americans told us that there is a different spectrum frequency plan for the city of Tucson from other cities, we would find it bizarre, yet that is what is happening in the EU,” said Viola.

New rules will seek to harmonise the EU spectrum, Viola said, explaining that the proposals would seek to address the speed at which member states roll out spectrum and the duration of contracts.

In a speech to Barcelona’s Global Mobile Congress on 26 February, Neelie Kroes, commissioner for the digital agenda, said the 27 EU states needed to align their approach on mobile spectrum and fibre broadband, creating a genuine single market.

Kroes described Europe’s poor efforts to release broadband spectrum as resembling “a bowl of spaghetti”.

The proposals on spectrum harmonisation will be controversial, since France, Germany and Britain are amongst those which oppose ceding control of spectrum auctions that bring billions into public coffers. Spectrum is often classed by member states as a matter of national security, and therefore off-limits to the EU executive.

Consolidation, but not at any price

Meanwhile Cecilio Madero, the Commission’s deputy director general for antitrust who is responsible for competition policy, told delegates at the conference: “A genuine single market would require less competition-oriented regulatory intervention.”

This is in line with the EU executive’s broad plan to free up the path to more consolidation in the telecoms sector, to encourage bigger, heavier-hitting European players.

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.

Madero made clear that such consolidation would not be allowed at any cost, and that the EU executive would not permit consolidation to result in price rises unless they can be justified.

“We think that Europe’s regulatory regime has been very successful in one way: at bringing down consumer prices, and Europe has amongst the world’s lowest prices for telecoms,” Daniel Pataki, the director of the European telecommunications Network Operators (ETNO), told EURACTIV in an interview.

“But at a time when investment is needed much more than before, and because of the technological changes and also when global competition is increasing from internet players, we see Commissioner Kroes’ announcement of a single market as a symbol that some things need to be changed against this backdrop,” Pataki added.

“The truly European single market would certainly facilitate the economies of scale that a healthy market more and more requires. As an example, the European 800MHz band support on terminal side is encountering issues which did not exists for the 700MHz band in the USA: this is related to the fact that the USA citizens can actually rely on a stronger single market,” according to Alessandro Casagni, the head of European wireless regulatory policy with tech company Huawei.

“The recent 800MHz auctions in Europe have drained financial resources out of the telecommunications sector in a moment in which public funds at European and national levels are being reduced,” Casagni said.

Radio frequency spectrum is a limited part of the electromagnetic spectrum as a whole, but it is extremely important due to its capacity to carry codified messages. This makes it an essential resource for telecommunication services such as mobile telephones, TV and radio broadcasting, satellite and broadband communications.

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

The allocation of spectrum has been marked by intense debate between member states on which services should be prioritised and how countries can conduct spectrum auctions around the same time to make sure the roll out does not create an uneven playing field.

  • June 2013: Draft rules on single market for telecommunications including provisions on spectrum expected to circulate

European Union

Industry federations and trade unions

  • European Telecoms and Network Operators (ETNO): Website

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