European Competitive Telecommunications Association

29 July  2020 - ecta Director General, Luc Hindryckx participates to the Better World Summit 2020

 Session International Industry organization: Accelerating Digital Inclusion to Embrace the New Normal

  • Global Harmonious Standards for a Better World - Mario Maniewicz, Director of Radiocommunication Bureau, ITU
  • Digital Policy and Telecoms Regulation for the Post-COVID Recovery - John Giusti, Chief Regulatory Officer, GSMA
  • Accelerating Digital Inclusion to Embrace the New Normal - Derek O'Halloran, Head of the Shaping the Future of Digital Economy and New Value Creation, WEF
  • Competitive Digital Markets as a Driving Force of EU Recovery - Luc Hindryckx, Director General, ecta

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Watch the playback here

Slide1

Hello Everyone,

France is one of the most competitive markets for Business to Consumer telecoms in Europe. For the last 5 years investments in Fixed and Mobile networks have grown year after year to exceed 10 Billions last year. 10,4 Billion to be precise according to the French NRA Arcep.

In the same country, the race for 4G deployment started in 2013, when Bouygues Telecom was authorised to deploy 4G in the 1800Mhz Band. The same year they achieved 40% population coverage.

Please remember those two examples for a moment.

But first I would like to thank Huawei for having invited me today.and given me the opportunity to share our views.

The last few months have shown by force of circumstance the strategic importance of telecom networks. A qualitative, reliable and secure broadband connexion whether it is fixed our Mobile is not only essential at home but also for enterprises small and large.

Slide2

Over the last months, the ecta members have been all hands on deck working around the clock watching out for the networks, services, and their users. It is more than fair to say that they hugely contributed not only to preserving network resilience and redundancy to assure service continuity for citizens and enterprises, large and small, but also to ensuring durable connectivity for data centres and those on the front line, the health actors.

In her mission letter to Executive Vice President Margrethe Vestager in charge of “a Europe fit for the Digital Age” the president of the European Commission Ursula von der Leyen indicated that In striving for digital leadership, we must focus on making markets work better for consumers, business and society, and that we must support industry to adapt to globalisation and the twin climate and digital transitions. We need companies that compete on equal terms and consumers that can benefit from lower prices, greater choice and better quality she said.

Slide3

Indeed, the digital transition will have an impact on every aspect of our economy and society and rapidly evolving digital technologies will transform all sectors and play a crucial role for society in confronting many challenges we face, notably for the environment, resource efficiency and climate change.

Slide4

The good news is that a competitive telecom sector and more generally said a competitive digital sector can be a driving force for all the other sectors of the economy to successfully address these challenges.

Ubiquitous, high performance 5G, fibre and comparable network technologies are increasingly understood to be the essential common infrastructure. This enables globally competitive digital transformation in all vertical sectors, shaping the future.

How does this work?

Well, let’s start with investment.

We all know the investments needs in 5G and fibre are important.

Let’s remember the 2 examples I started with.

The first one: 10.4 Billion investment in networks last year in France, probably most competitive B2C market with 4 main integrated Fixed-Mobile MNOs and several MVNO and Fibre deployments initiatives.  

Slide5

And the second one: The race for massive 4G deployment bursted out only when Bouygues Telecoms was allowed to deploy 4G in 1800Mhz and covered 40% of the population in the same year.

Slide6

This illustrates why competition is important for investment. Competition drives investment.

There are more benefits of competition: what about customer service?

In Spain Masmovil fully entered the Spanish market when it benefited from the remedies imposed by DG competition when clearing the acquisition of Jazztel by Orange and later when they bought Yoigo the fourth MNO. In a market already well captured they successfully focussed on customer service. They continuously score best at the GFK Net Promotor Score.

Slide7

Yes, competition significantly improved customer service.

Let’s not forget Innovation

The EU telecom policy focus of the last two decades has been on consumers and unfortunately Business to Business markets remains highly concentrated.  Hence, the focus for the next decade will be Business to Business or will not be!

Slide8

This requires a change in business approach from a focus on the consumer mass market to enabling business users across all industries and sectors, from start-ups to established conglomerates.

Locking forward, with the Fourth Industrial Revolution as we said before, it is essential for all the other sectors of the economy to smoothly achieve their competitive digital transformation. This has never been so important as today.

This means that the strategic alignment of operators in the Business to Business markets has to move to closer intimacy with their customers and new business models have to emerge

Slide9

Telecom and digital resources are the driver for this.

To unleash the innovation potential of all the other sector of the economy, it is essential that they can rely on a diversified offer of product and services proposed by diversified players, small and large. This is essential for new business models to emerge and to overcome the barrier of the cannibalisation of existing business models.

Slide10

The fear for cannibalisation is one of the biggest barriers to innovation by well established players.

Indeed, let me stress that competition not only has provided lower prices, improved quality and efficiency, but it has also been the fundamental driver of innovation – the driver that forces market players to continue to improve. And don't we all want to see our children pulled upwards in the class room?

In the same vein, allow me a final comparison with football. Are the best performing national teams not those that have their players active in competitive championships?

Do we expect less from the digital sector? Of course not.

To conclude:

Society as a whole will most benefit if there is sufficient competition in all element of the value chain. This is also absolutely true for the suppliers. 

Thank you for having listen to me.

Slide11

 

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