European Competitive Telecommunications Association

ECTA welcomes the Commission´s commitment to reinforce the single market and to encourage investment in open and competitive fibre access networks

The pro-competitive body calls for the vigorous application of competition rules to fibre access networks - consumers and businesses will pay a high price if competition rules are relaxed and wholesale pricing flexibility is permitted to dominant telcos

Brussels, 19 May 2010; ECTA strongly supports the Commission’s renewed commitment to reinforce the single market for telecommunications services as outlined in the new European Digital Agenda presented by Commissioner Kroes today. 
“A fully functioning single market would benefit consumers and businesses by bringing wider choice, lower prices and higher broadband speeds” said ECTA Chairman Hubertus von Roenne. 

“A ‘seamless regulatory space’ is needed to foster both competition and efficient, sustainable investment; delivering innovative services at affordable prices for all European citizens. Commission guidance is crucial to ensure that the most fundamental single market principles such as non-discrimination and access to bottleneck infrastructure at fair prices are applied consistently across Europe. 

ECTA also welcomes the Commission’s confirmation of the EU2020 strategy’s key action to encourage the deployment of open and competitive next generation access networks. “The forthcoming recommendation on Next Generation Access is a key opportunity for the Commission to systematically and firmly eliminate competitive failures” commented the ECTA Chairman. Today consumers and businesses are losing €25bn per year and broadband speeds are being restricted due to uncompetitive telecoms markets. The Commission’s Digital Competitiveness Report released yesterday also found that competition is stagnating and incumbents are regaining market share in some countries. This underlines the need for strong Commission action to tackle discrimination and unfair access prices by dominant operators and reinvigorate competition. ” 

The pro-competitive body warns that the single market objective will be undermined and consumers and businesses will be forced to pay a high price if competition rules are systematically relaxed in regions where telecoms companies enter into closed co-investment deals. “If non-Europe costs €25bn today, what would be the price of a regionally fragmented Europe? Regionally differentiated pricing rules mean even higher prices for consumers and businesses trying to make a living outside big cities” added von Roenne.

ECTA is also concerned that permitting flexibility in setting the price of wholesale access to bottleneck next-generation networks will allow dominant firms to keep competitors out of the market and charge excessive retail prices to consumers. The dominant operators who are asking for wholesale pricing flexibility today have been found guilty of abusing their market power in the past by charging unfair prices that squeeze the profit margins of their competitors. Ex-ante protection against margin-squeeze is therefore essential. 
“In her previous post as Competition Commissioner, Mrs Kroes has taken a tough line in reprimanding abusive behaviour including margin-squeeze. Building on that experience, we urge Mrs Kroes to prevent further abuse by firmly sticking to the principle of cost-based access prices and not to give gaming flexibility to dominant operators.” concluded von Roenne.

For further information please contact Erzsebet Fitori, Senior Manager Regulatory Affairs, ECTA Tel: +32 2 227 1156

About ECTA
The European Competitive Telecommunications Association (ECTA) looks after the regulatory and commercial interests of new entrant telecoms operators, ISPs and suppliers of products and services to the communications industry.

ECTA works for a fair regulatory environment that allows all electronic communications providers to compete on level terms in order to multiply investment and innovation throughout an effective European internal market.  The association represents the telecommunications industry to key government and regulatory bodies and maintains a forum for networking and business development. 
ECTA  member companies include operators, service providers and suppliers as well as National Associations of such which all contribute towards regulatory policy development and participate in our comprehensive range of networking events, conferences, seminars, briefings and executive meetings. www.ectaportal.com

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