Outgoing EU digital economy commissioner Neelie Kroes has announced that the European Commission will no longer regulate the retail market for access to fixed telephony and the wholesale market for fixed call origination. In addition, the EC will redefine two broadband markets with a view to "limiting regulatory burdens to what is strictly necessary for competitive broadband access and investment". Specifically, the new rules recognise that offering “virtual access products” can be considered substitutes to physical unbundling when they fulfil certain characteristics.
In a statement outlining the changes, which are to take effect immediately, the EC confirmed that the new rules were prompted by proof of increased competition in the sector and declining use of traditional fixed-line services. “There has been a decrease in volume of fixed calls as customers have turned to alternative solutions, such as voice-over-IP (VoIP) and mobile calls, but also to alternative providers, like over-the-top (OTT) players,” said the EC, adding that “those customers who still use fixed telephony are now able to purchase fixed access from a number of different platforms, such as traditional telephone network, fibre or cable networks, and also from alternative operators offering broadband and voice services over unbundled local loops, so competition has been increased.”
Announcing the deregulation, Kroes said it would help cut EU red tape by 30 percent without harming competition. “This cut in telecoms red tape… is the result of increased competition in telecoms markets and it takes us a step closer to a real Connected Continent,” she said. The changes were in fact envisaged in the first part of the wider ‘Connected Continent’ regulation that proposed to end mobile roaming premiums and introduce net neutrality.
The news was welcomed by industry lobby group ETNO, which described it as "a fundamental first step if we are to unlock the massive investments needed." At a recent summit, ETNO chairman Luigi Gambardella called for a reform of the EU’s current regulatory approach to help telecoms operators multiply their investment. ETNO members such as Telecom Italia and Deutsche Telekom will now have greater freedom in setting the prices charged to smaller operators for access to their networks and to retail customers for making fixed calls.
