This article is part of our special report Broadband: driving recovery?.
As the European Commission prepares new guidelines to deploy high-speed fibre cables across the EU, major telecom operators are recommending an approach similar to mobile telephony, based on competing networks. But such a move is rejected by new market entrants, who argue against duplicating expensive infrastructure.
The European Commission will put forward a set of guidelines for discussion in the coming months in an attempt to catch up with international competitors that are already extensively deploying Next Generation Networks (NGNs), EURACTIV has learnt. The objective is to agree on common rules by the end of the year, according to European sources close to the dossier.
NGNs were not part of the Telecoms package review proposed last November by the Commission, but are increasingly considered as a key element for development in the sector in years to come (see our LinksDossier on the Telecoms review).
Catherine Trautmann, the French socialist MEP in charge of steering the dossier through the European Parliament, has highlighted the necessity of including NGNs in the reform of the Telecoms sector on several occasions. The Parliament is widely expected to back her report in a plenary vote in July (EURACTIV 25/04/08)
For the EU's major telecom operators, "the fact that the Commission has not included this strategic element in its review of the sector is still a mystery," said Michael Bartholomew, the director of ETNO, an association which brings together former state-run companies such as Telecom Italia and France Telecom.
ETNO therefore calls on the Commission to agree new measures to spur investments and suggests adopting a system based on the model developed in the mobile phone sector. Under this model, operators tend to deploy their own networks instead of sharing infrastructure, which is the current model for landline telecom companies.
Parallel networks, though more costly, are supposed to bring prices down for customers, ETNO claims, and should also help increase coverage of areas currently deprived of infrastructure for broadband Internet connections. But new market entrants such as Tiscali or Tele2 oppose this concept, preferring sharing the incumbent's infrastructure instead.
Geographical segmentation is another key measure which could favour NGN deployment in the Telecoms sector, according to incumbent operators at ETNO.
On this front, the UK is currently leading the way in Europe. The British regulator, Ofcom, has already split the national market into a series of regional markets with different regulatory needs on the basis of their level of competition (EURACTIV 15/02/08).
Incumbents want this measure to be applied everywhere in Europe but new entrants consider it unnecessary and the outcome to be unpredictable.