Europe’s top telcos have warned that proposals by the European Commission for functional separation of dominant telecom operators, along the lines that BT Group has adopted by ring-fencing its core network operations, will hit investment in broadband services.
At its annual conference in Brussels, the European Telecommunications Network Operators’ Association (ETNO) called on EU policy makers to focus on how to encourage private investment in high-speed broadband access networks as new services and growing number of users require increasing bandwidth capacity.
ETNO said the EU review, by focusing mainly on functional separation, missed the opportunity for the deployment of next-generation access networks. It said functional separation is not needed to achieve competition because current tools have already led to open competition, increasing broadband take-up throughout the EU. ETNO said functional separation represents a shift from a transitory market-driven approach to a model based on a permanent regulatory approach and a utility conception of the telecoms sector.
Bojan Dremelj, president of Telekom Slovenije, said there is no need for over-regulation. How can we ever become the most competitive economy in the world if we are stifling innovation? he said. If we cut the wings of our big players, aren’t we cutting the ‘branch on which we are sitting’? Is this what Europe is aiming for?
Central to the dispute is replacing copper links with fiber, which is accepted to be the next stage in broadband. Incumbents argue that this will not be viable if competitors can then move in and take their customers.