European Commissioner Neelie Kroes has defended plans to reform the telecoms market against criticism from incumbents.
The Commissioner spoke at a conference in Brussels today that was organised by lobby group ECTA, which represents challenger…
European Commissioner Neelie Kroes has defended plans to reform the telecoms market against criticism from incumbents.
The Commissioner spoke at a conference in Brussels today that was organised by lobby group ECTA, which represents challenger operators, only days after receiving a letter from CEOs from incumbents that was highly critical of the EC’s plans.
In the letter, seen by the Financial Times and sent to EC president Barroso, the CEOs called for deregulation to ensure infrastructure investments. They said more mergers should be allowed, and regulation that forces incumbents to grant competitors wholesale access to their fixed line networks should be abolished. The letter was signed by the chief executives of Telecom Italia, Deutsche Telekom, France Telecom and Telefonica.
Kroes, who did not mention the letter during her speech, likened the situation to the liberalisation of the airline industry several years ago.
She said when that market was liberalised the EC was faced with fierce resistance from incumbent operators. But the Commission forced through liberalisation and brought down barriers resulting in huge innovation.
Today, former incumbents compete with new entrants, prices have come down and the number of passengers flying has gone up, Kroes noted.
Speaking at a panel debate, Tele2 CEO Mats Granryd pointed to the stability of the regulatory framework and its predictability as key points.
He also criticised the EC’s lack of flexibility in allowing further in-country consolidation. The number of operators required in markets to ensure healthy competition differs from country to country, he argued. While in some markets two operators might be sufficient, it might make more sense to have four in others.
