Two speed broadband: Europe underlines regulatory problems to be addressed through reform

[news release] Although some European countries lead the world in broadband access, there is a growing gap between the best and worst performers, according to a report presented by the European Commission today. Lack of competition and regulatory weaknesses are cited as the main obstacles to broadband growth. The Commission will address these shortcomings in its proposals to reform the EU’s Telecom Rules on 13 November.”Broadband growth remains strong with the top EU countries now world leaders in broadband penetration,” said EU Telecoms Commissioner Viviane Reding. “However, it is unacceptable that the gap between the strongest and weakest performers in Europe is growing. Europe must act now to get its broadband house in order. I will make specific proposals on this as part of our package of reforms for the EU Telecom Rules on 13 November.”According to data published by the Commission today, the gap between the strongest (Denmark 37.2%) and weakest broadband performers (Bulgaria 5.7%) is widening slightly, with now more than a 30 percentage point difference. The main reasons for this are the lack of significant alternative infrastructures in some Member States or the need for a more consistent and speedy application of existing remedies (see IP/07/435). More needs to be done to stimulate investment so there is more consistent growth across the EU. Effective competition on the broadband markets in order to achieve “broadband for all” is therefore a key priority of the reform of the EU Telecom Rules that the Commission will propose next month.Broadband growth has continued in the last year throughout the EU, as businesses and citizens continue to benefit from the digital revolution (see IP/07/582). Average penetration (number of subscribers per population) has grown from 14.9% to 18.2%, despite the relatively modest penetration rates in some Member States. In the best performing countries – Denmark (37.2%) and The Netherlands (33.1%) – roughly one third or more of the population has broadband, with a substantial proportion using an infrastructure other than the incumbents.On 1 July 2007 there were over 90 million fixed broadband lines in the 27 EU Member States of which some 20 million lines, excluding Bulgaria and Romania, have been added since July 2006, an increase of 28.7%. Proportionally growth was highest in Denmark (7.7 lines per 100 inhabitants), Luxembourg (7.1 per 100) and Ireland (6.7 per 100).Digital Subscriber Line (DSL) remains the EU’s main broadband technology, with some 72.5 million lines. However, DSL growth has slowed by 6.1% compared to July 2006, while alternative technologies such as cable, fibre to the home, wireless local loops, are more widely used, totalling some 17.7 million lines.There has been intense competition in DSL subscriptions, demonstrated by a high growth of unbundled local loop products: 55.4% of all alternative operators’ DSL lines (17.6 million lines) are either fully or partially unbundled, compared to 45.9% in July 2006. Resale (8.2 million lines) remains an important type of wholesale access, in particular in the UK (where the national regulator has imposed functional separation, thereby ensuring that resale takes place under conditions of non-discrimination) and Germany (where resellers continue to be strongly dependent on the conditions set by the incumbent).The market share of the alternative operators in Europe has continued to grow and has reached 53.5% in July this year. However, the market share of new market entrants is only at 44.3% if simple resale of incumbents’ DSL lines is excluded. Alternative operators also increasingly invest in their own networks compared to services based on the incumbents’ infrastructure.Background:
The availability of broadband is a key indicator of ICT development. The Commission regularly reports on the development of broadband markets in the EU with the data validated by Member States via the Communications Committee. The report is available at: news release was sourced from see:
EU may consider regulating broadband pricing [IDG]
The gap between broadband haves and have nots in the European Union has widened during the past year, a trend that might warrant price regulation similar to that imposed on the market for mobile roaming charges earlier this year, the European Commission said Monday.

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