EU says telecoms market ‘too fragmented’

Businesses and consumers across the EU are plagued by high prices because of inconsistent application of EU telecoms rules, the European Commission says.Mobile phone call charges range from 0.04 euro per minute in Latvia to 0.24 in Malta, a Commission report says.Big price differences are hampering efforts to create a single market in EU telecoms.There was zero growth in EU telecoms in 2009, while the overall EU economy saw a 4.2% decline.This BBC News report was sourced from: see:Telecoms: citizens and businesses pay the price for inconsistent application of EU rules [news release]
Consumers, businesses and the EU economy as a whole are denied the full economic benefits of a truly single and competitive EU-wide telecoms market because of inconsistent application of EU telecoms rules, according to the European Commission’s annual report on the Single European Electronic Communications Market. Most Member States’ markets have become more competitive, but remain national in dimension. Moreover, the level of competitiveness varies strongly between Member States. Although Europe’s telecoms sector weathered the financial storm in 2009 (0% growth compared to a 4.2% EU-wide economic decline), consistent enforcement of existing rules and investment in innovative services hold the key to future growth. In its Digital Agenda for Europe (IP/10/581), a flagship initiative under the Europe 2020 strategy (IP/10/225), the Commission urges the telecoms industry and EU governments to join forces to bring high-speed internet access and interactive communications services for all citizens and businesses.Digital Agenda Commissioner Neelie Kroes said: “Rapid growth of mobile broadband and more affordable internet access are good news for consumers in these tough economic times. Yet the limited progress towards a true Single Market is disappointing. Member States need to do more to ensure telecoms rules are properly implemented and the necessary investments in innovative services made for the benefit of all 500 million European consumers.”Telecoms markets withstand economic crisisEurope’s telecoms market experienced zero growth in 2009 but fared well compared to the overall economy’s 4.2% decline. Focusing on fast-growing innovative services such as mobile data services could boost the sector’s future development. But inconsistent implementation of existing EU rules fragments telecoms markets along national borders, denying businesses access to a genuine Single Market.Inconsistent regulation hinders Single MarketMajor price differences still exist between Member States both at retail and wholesale level. Retail mobile prices in the most expensive Member States are four times higher than in the cheapest, e.g. 4 €-cents per minute in Latvia compared with 24 €-cents in Malta.This situation is partly due to different regulatory approaches across the EU. Consumers and business still face 27 fragmented national markets. National telecoms regulators often delay, sometimes by years, the enforcement of EU rules. For example, in wholesale broadband markets, some national regulators control the fibre networks of the incumbent operators, while others limit regulation to the old copper-based technology. Regulation of wholesale broadband markets shapes the competitive landscape and so determines the price and quality of broadband products available to consumers and businesses.Consistent application of telecoms rules is needed to foster the roll-out of investment-intensive infrastructure such as Next Generation Access (NGA) networks. As outlined in the Digital Agenda, the Commission will adopt a Recommendation on NGA networks later this year.The newly established Body of European Regulators for Electronic Communications (BEREC) will assist the Commission with its work to tackle the remaining divergences and to ensure that Member States implement the EU rules consistently.Use of high-speed internet is growingAverage EU take up of fixed broadband per capita reached 24.8% as of January 2010 – more than 123 million lines. Denmark and The Netherlands are world leaders in broadband, with nearly 40% of the population enjoying broadband internet access. EU mobile broadband take-up almost doubled to 5.2% from January 2009 to January 2010. Finland, Portugal and Austria had penetration rates of over 15%.Growing demand for mobile broadband internet will put even greater pressure on limited radio spectrum. Higher capacity will be needed to meet the requirements of increased data traffic.The Digital Agenda contains specific measures to bring 100% broadband coverage for all Europeans by 2013. It foresees a Radio Spectrum Policy Programme, which will ensure that radio frequencies freed by the transition from analogue to digital broadcasting (the ‘digital dividend’) are available for new services, including mobile broadband.Consumer prices fallingPrices for internet connections declined in 2009 thanks to flat rate offers and faster broadband speeds. For mobile voice calls, EU consumers paid 7% less than in 2008, withthe average price per minute falling to 13 €-cents from 14 €-cents. Consumers could switch their operator while keeping the phone number faster than before. On average, it took 4.1 days to do so for mobile and 6.5 days for fixed numbers in 2009 compared with 8.5 and 7.5 days respectively in 2008. Despite progress, more efforts are needed to reach the goal of one-day outlined in the 2009 EU telecoms rules (MEMO/09/568).A press pack with the 15th Progress Report on the Single European Electronic Communications Market 2009 and EU Country summaries is available at: further information, see MEMO/10/211.This European Commission news release (including tables), dated 25 May 2010, was sourced from:

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