Europe's telecoms industry will soon face fewer price controls and less regulation, according to a plan due to be announced by the European Commission next week.
The commission wants to free seven of the present 18 telecoms markets from regulation, including the important markets for providing local, national and international calls to retail customers, according to draft proposals.
This means national regulators will find it much harder to force former monopolies such as Deutsche Telekom to grant rivals access to their networks and tell them what prices to charge.
The move reflects the commission's belief that competition from new market entrants has now become so fierce that previously dominant operators are no longer able to dictate terms to their rivals and customers.
The deregulation drive, to be presented on June 28th by Viviane Reding, the EU media commissioner, is certain to please Europe's €300 billion telecoms industry. A group of 30 chief executives from companies such as Deutsche Telekom, Telecom Italia and Telefónica had earlier this month called on Ms Reding to reduce the number of markets subject to regulation to a "small set of wholesale markets".
The initiative comes, however, at a time when the commission is tightening the screws on the telecoms industry elsewhere. Ms Reding has promised to slash the costs of international roaming through new regulation, and is due to present a formal proposal next month.
According to the European Union telecoms regime, the commission is responsible for defining the markets that are subject to ex-ante regulation - meaning that national authorities are allowed to regulate access to networks, issue price caps and set the terms under which dominant groups deal with their rivals and customers.
Although national regulators may depart from the list, they face a stiff test for doing so. The commission argues that the position of former monopolists remains too strong.
The commission's list of regulated markets forms only part of a wider review of the union's legal framework work for the industry.
- (Financial Times service)
