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EU to regulate broadband pricing

Follows mobile phone roaming regulation

The EC (European Commission) today said that the gap between broadband haves and have nots in the European Union has widened during the past year. As a consequence of this trend, the EC is to consider price regulation similar to that imposed on the market for mobile roaming charges earlier this year.

Fewer than six percent of Bulgarians have access to broadband internet access, while nearly 40 percent of Danes do, the Commission found in its latest study into broadband penetration across the 27 member states of the EU.

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The main reasons for poor market penetration in countries such as Bulgaria are the absence of any real competition for the former national telecoms monopolies, and inadequate Europe-wide regulation, the Commission concluded.

See also: Cheap mobile phone roaming now compulsory

"It is unacceptable that the gap between the strongest and weakest performers in Europe is growing. Europe must act now to get its broadband house in order. I will make specific proposals on this as part of our package of reforms for the EU telecom rules on 13 November," said telecoms commissioner Viviane Reding.

Still basking in the widespread praise she enjoyed for slashing the price of using your mobile phone abroad, Reding is now considering a similar intervention in the broadband market, to force down prices in uncompetitive markets in the Union.

Asked if Reding would intervene to force down broadband prices, her spokesman Martin Selmayr said: "Prices play an important role, but price regulation should be a last resort only."

Overall broadband penetration has continued to grow throughout the Union in the past year. The average number of subscribers has grown from 14.9 percent of the population to 18.2 percent, despite the relatively modest penetration rates in some member states. In the best performing countries - Denmark (37.2 percent) and the Netherlands (33.1 percent) - one third or more of the population has broadband, with a substantial proportion using an infrastructure other than that offered by the former national monopolies, the Commission said.

On 1 July there were more than 90 million fixed broadband lines in the EU, of which some 20 million lines have been added since July 2006, an increase of 28.7 percent. Proportionally, growth during this 12-month period was highest in Denmark (7.7 lines per 100 inhabitants), Luxembourg (7.1 per 100) and Ireland (6.7 per 100).

DSL (Digital Subscriber Line) remains the main broadband technology, with some 72.5 million lines. However, DSL growth has slowed compared to when it was measured in July 2006, while alternative technologies such as cable, fibre to the home or wireless local loops are more widely used, totalling some 17.7 million lines, the Commission said.

There has been intense competition in DSL subscriptions, demonstrated by a high growth of unbundled local loop products: 55.4 percent of all alternative operators' DSL lines (17.6 million lines) are either fully or partially unbundled now, compared to 45.9 percent in July 2006.

However, the Commission warned that many European citizens are being denied the benefits enjoyed in the more competitive countries in the EU.


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