EU Telecoms Regulation Needs to Move Faster

News Article - Friday, 26 April 2013 13:10

By: Kerry Butters Category: Connectivity

The telecommunications trade association representing former state owned operators have said that an overhaul of the regulatory environment for the industry in the EU must move quicker.

The trade association, known as ETNO, said on Thursday that an overhaul of current regulations should take place before the European Council meeting set for October.

"We believe that this work should be done as early as possible, possibly well before next October," said Luigi Gambardella, chairman of ETNO. "The situation demands that we act fast."

The statement comes amid growing tension between Europe’s largest telecoms operators and EU officials on how best to "consolidate the hypercompetitive industry”.

The matter is due to be discussed at October’s council meeting but the European Commission’s digital chief, Neellie Kroes, said that operators are the ones who need to make progress. The ongoing debate has been going on for months over operators who want to buy smaller telecoms players within national markets, initially.

However, the EU favour cross-border acquisitions.

"When a sector is faced with falling revenues and a lack of long-term sustainability, such an industrial strategy can no longer be considered reasonable, credible or effective," Mr. Gambardella said of the current approach to regulation.

"In reality, competition has shifted from the national level, and indeed from the European level, to the global arena."

In order for European telecom providers to be able to compete successfully with rivals from North America and Asia, "they need to be able to achieve greater scale through consolidation,” he went on to say.

In the EU, there are more than 1200 fixed telecom and 100 mobile operators, compared with just six major providers in the US and three in China.

"Over the past years, we have been confronted with an extremely difficult market situation and over-intrusive regulatory conditions, which have resulted in a prolonged decline in revenues," Mr. Gambardella concluded.

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