European Competitive Telecommunications Association

A stable policy framework for maximising investment and consumer benefits: Vice President Neelie Kroes meets ECTA Financial Chiefs  

Brussels, 22 October 2012: Today a delegation of the Chief Financial Officers (CFOs) from the member companies of the European Competitive Telecom Operators (ECTA) met with the European Commission’s Vice-President Neelie Kroes, to discuss the important role that the challengers of dominant firms play in driving future high-speed broadband investments.

A stable policy framework for investment should ensure equal opportunities for challenger investors, maximising the investment potential of the sector. At the same time it should preserve the investments that alternative operators made since their entrance on the market and their ability to remain the catalysts of both competitive consumer offers and investments in super fast broadband networks.

"This is a crucial time for the future of communications in Europe” said Tom Ruhan, Chairman of ECTA. "As the Commission is working on a stable regulatory environment to last until 2020, it is important that policy makers recognise that new entrants have been so far the main drivers of fibre investments and the take-up of advanced broadband by consumers. Going forward competitive operators are the main catalysts of new network build and need a stable environment facilitating new competitive investments but also ensuring that they can build on the investments already made.”

CFOs from Iliad/Free, Bouygues Telecom, Fastweb, Wind and Netia put on the roundtable organised with the European Commission and financial analysts the actual figures of NGA investments made so far(1) and their genuine commitment to keep investing in the short and in the long term. They called on the European Commission to work on a regulatory environment that enables them to continue delivering the significant benefits competition has brought to consumers and business users also in a next generation broadband environment. Public policy should be there to maximise consumer welfare alongside incentivising efficient investment by all parties.

The Director of ECTA, Erzsebet Fitori said "we are grateful to Vice-President Kroes for giving us the opportunity to work together for a stable regulatory environment that recognises the important role that competition plays in stimulating investments. In this respect a fair balance is to be found that ensures equal opportunities for dominant and challenger investors and protects the hard earned benefits of competition in the market today. The Digital Agenda’s take up targets cannot be met without ensuring a sustainable economic space for competition in the long term.”

More than ten years after liberalisation, alternative operators are still suffering heavily form discrimination in access conditions and pricing abuses from dominant operators.(2)  A  large part  of alternative operators’ cash flows are paid to dominant firms for overpriced access charges to legacy copper networks thus making them struggle to be able to compete and invest at the same time. For this reason, welcoming the efforts aimed at establishing a balanced and stable framework for future investments, ECTA CFOs called onto V-P Kroes to preserve all  present and future investments and to significantly tighten non-discrimination obligations guaranteeing equivalence of inputs at wholesale level and preventing pricing abuses at wholesale and retail level taking into consideration all the specificities of the different EU markets..

This is the only way to guarantee that not only investors but also European consumers reap the benefits of future ultra fast broadband networks.
 
 
 
(1)  As recognised by independent figures collected for the FttH Council Europe, alternative operators account for 55% of all the FttH investments made in Europe https://dl.dropbox.com/u/75128301/FTTH_Investors.jpg 
(2) Abuses of dominant position and violations of competition law by dominant telecom operators are still very common. In 2011, for instance, the Commission fined Telekomunikacja Polska EUR 127,5 million for unlawfully refusing to grant alternative operators access to its wholesale products for more than four years. In 2012 the EU Court of Justice confirmed the conviction of Telefónica de España for unfair pricing behaviours. For more information see EC Competition website: http://ec.europa.eu/competition/sectors/telecommunications/broadband_en.html

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ECTA (the European Competitive Telecommunications Association - www.ectaportal.com ) is the pan-European pro-competitive trade association that represents more than 100 of the leading challenger telecoms operators across Europe. For over a decade, ECTA has been supporting the regulatory and commercial interests of telecoms operators, ISPs & equipment manufacturers in pursuit of a fair regulatory environment that allows all electronic communications providers to compete on level terms. Our members have been the leading innovators in Internet services, broadband, business communications, entertainment and mobile. Contact: Federico Poggi, Senior Manager Public Affairs (+32 2 290.01.03 / This email address is being protected from spambots. You need JavaScript enabled to view it. ).

 

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