EU heeds telecoms call for lighter regulation, network investment

Roberto Viola [European Commission]

Policy executives from Orange, Deutsche Telekom and BT urged a step back in regulations on Tuesday (23 June), arguing they discourage private investment.

Less regulation will drive investment and balance out loopholes tipped in favour of Internet competitors like Skype or WhatsApp, which are offering services for free, the representatives from the big three telco firms argued at the annual conference of telecoms association ETNO.

The European Commission seemed to agree, saying its priority was to promote cash flow to build up broadband infrastructure run by big telco firms.

“Clearly there’s no appetite for the Commission to play a central role and dictate rules everywhere in Europe,” said Roberto Viola, deputy director of DG Connect, the Commission department regulating telecoms and the Digital Single Market.

“The focus for us will be investing,” he said. Viola acknowledged the broader trend towards decreasing regulation in other European industries. “There will be no other focus, no strange experiments about the governance of the system, whether the system is better managed centrally or locally.”

Building up networks

Sorting out network infrastructure is central ahead of growth in connected devices and the introduction of 5G mobile networks, Viola said.

“Europe cannot make the disaster it made with 4G,” he added. Some European countries are still struggling to bring out 4G access, lagging behind other member states by several years.

Representatives from Europe’s telecoms gathered in Brussels to mull over regulations governing the sector, including on company consolidation and access to broadband networks.

Competition Commissioner Margrethe Vestager fired back against telecoms consolidation last week, when she said big companies don’t need to buy out their competitors to survive in the industry.

But telecoms insist that less intervention will help attract private funds and build up networks.

Some government regulators are questioning their roles in overseeing big companies with dominant market positions.

Sébastien Soriano, who became president of French telecoms regulator ARCEP earlier this year, said that Europe needs to focus its support on industry startups.

“The previous Commission wasted time trying to make the telecommunications sector the alpha and omega of the digital market. The size of our telecommunications operators has become a marginal issue in the challenges today,” Soriano said.

Former EU competition commissioner Joaquín Almunia approved major telecoms consolidation deals, including Spanish giant Telefónica’s acquisition of German E-Plus last year.

>> Read: Commission approves Telefónica’s acquisition of E-Plus in Germany

Soriano also lauded ARCEP’s work on net neutrality in France, a touchy subject among the telecoms crowd. ETNO has pushed back against net neutrality proposals that limit telecoms companies’ offers of specialised services, which can be included in packages sold to consumers.

“Net neutrality will not be sufficient to ensure open internet,” Soriano said.

“We need to examine the situation of the very few giants that dominate the web today,” he added.

>> Read: EU to water down net neutrality rules

OTTs vs. telecoms

Telecoms have butted heads with internet giants before, over so-called “over-the-top” products like WhatsApp and Skype, offered for free by Facebook and Microsoft.

European internet providers have rebuffed those as unfair rivals to their paid SMS and voice call services.

Speakers at Tuesday’s conference circled around the topic of over-the-top services on a panel discussion with Google’s European public policy manager, Theo Bertram.

“All OTTs [over-the-top] and telcos are mutually dependent,” Bertram argued.

Eut EU policymakers seem more sympathetic to telecoms operators’ calls to balance out advantages tilted towards tech companies.

“If you ask your customers to pay for Voice over IP, Voice over fibre networks, or whatever other networks, basically you pay for this service. I think it’s perfectly normal that you have more rules for companies offering this service for free,” said Roberto Viola.

  • Summer 2015: Commission to launch public consultation on the new regulatory measures
  • 2016: European Commission plans to announce an overhaul of telecoms regulations

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