09 October, 2014

Press Release: Relevant markets recommendation: positive signals, more ambition needed

ETNO welcomes the de-regulatory elements in the revised Recommendation and calls for bolder reform

ETNO welcomes the adoption of the revised recommendation on Relevant Markets, which was announced today by Vice-President of the European Commission Neelie Kroes. This Recommendation is the key regulatory tool defining the perimetre of ex ante regulation for electronic communications product and service markets under the present EU regulatory framework.

The Recommendation is regularly revised in order to recognise competitive dynamics in telecoms markets and verify if ex ante regulatory measures are still justified.

ETNO Chairman Luigi Gambardella said: “EU citizens and businesses demand superfast networks: moving away from unnecessary regulation is a fundamental first step if we are to unlock the massive investments needed. We encourage Juncker’s Commission to embrace an ambitious investment agenda and pursue bold regulatory reform accordingly”.

During this revision, which comes after the 2007 one, the European Commission has decided to reduce sector-specific regulation overall. With today’s announcement, regulated markets are cut to nominally 4 – from 7 in the previous recommendation. More specifically, former telephony access markets have been removed taking stock of dynamics such as competition from Over the Top (OTT) services, ongoing transition to all-IP and intensified fixed-mobile substitution.

The Recommendation sends an important signal that next generation broadband  networks no longer need to be subject to ‘physical unbundling’ regulation, which often proves technically or economically unviable for new fibre technologies. Instead, active products may be used to offer open access to such networks.

The Recommendation approved today also presents critical aspects, though, in particular by potentially enlarging the scope of certain wholesale markets for business services. ETNO believes that business markets which are fiercely competitive in the EU should not be distorted by additional regulation.

Next Commission term: let’s go for a bold reform

ETNO has long been advocating for a new regulatory approach, that recognises how markets have changed dramatically in the past years. Competition from alternative access platforms as well as from OTTs is today well established.

For this reason, we urgently call for ambitious reform. Less ex ante rules with a stronger emphasis on commercial negotiations and a more cross-sectorial approach will lay the ground for a much needed investment-friendly environment.

#END#

Background Note