EU seeks to spur fast broadband roll-out with telecoms reform

TAGS: Business, EU

The European Union aims to spur the roll-out of fast broadband across the 28-nation bloc by relaxing rules that force telecom companies to open up their networks to competitors.

Under planned reforms of the sector, national telecoms regulators will be required to take into account existing commercial agreements between operators when deciding whether to force them to allow competitors access to their networks, according to a document seen by Reuters.

Fostering investment in new fiber-optic networks, to meet rising demand for data services, is a major plank of the European Commission's reform of its 15-year-old telecoms laws.

National regulators will also have to weigh up the range of retail choices available to users to ensure that regulation is not more of a burden than necessary on operators' decisions to invest, the document says.

The costs of running optic fiber - which can deliver speeds of up to 1 gigabit per second - into households are high. Telecoms operators such as Orange, Deutsche Telekom and Telecom Italia have long complained that the current rules forcing them to open up their networks to competitors at regulated prices do not allow them get a decent return on investment.

According to the Commission's figures, 68 percent of homes in the EU have access to broadband with speeds of at least 30 megabits per second. Malta, Belgium and the Netherlands have the highest coverage while Italy, France and Greece have the lowest.

National regulators will be required to monitor the network investment decisions of operators and will have the power to sanction them if they deviate from their declared intentions without justification, the document says.

The aim is to protect operators who lay fast broadband networks first in areas where there is little financial incentive, such as rural areas, and where the arrival of a second operator would undermine the first's business case.

The Commission, the EU's executive body, will also seek to encourage operators to co-invest in shared rollouts of fiber-to-the-home by offering them lighter access rules in return.

Operators who adopt a "wholesale-only" model, whereby they sell access to their networks to other firms and do not offer consumers their own retail broadband packages, will benefit from lighter rules.

In a bid to coordinate how national governments allocate blocks of airwaves to mobile operators such as Vodafone, EE and Telefonica, the telecoms reform will allow the Commission to set a minimum spectrum license duration of 25 years, according to the document.

National authorities are loath to relinquish control over how they auction wireless spectrum, which they consider a national resource, and license durations vary across Europe, making it harder for companies to operate on a larger scale. Spectrum auctions can fetch billions of euros.

Once unveiled, the proposals will need to be approved by the European Parliament and national governments, meaning they are likely to undergo changes. [Reuters]