The European fixed broadband market is flourishing, but a number of leading connectivity providers have published an open letter expressing “alarm” over European Commission (EC) proposals to relax regulation on former fixed monopolies, which they say could disrupt investor confidence in their markets.
The letter was signed by CEOs and chairs of Bouygues Telecom, Colt Technology Services, Eurofiber, Fastweb+Vodafone (Italy), iliad GroupOpen Fiber, CK Hutchison Group Telecom (Three Group),1&1 AG and Vodafone Group. They called the EC’s proposals a backwards step, warning that deregulation of wholesale access would lead to remonopolisation, and stifle competition and investment in fixed connectivity services, particularly during the migration from copper to fibre.
The main point the executives made was that, for decades, European consumers and businesses have benefited from choice, value and innovation in fixed broadband infrastructure, underpinned by a predictable and established regulatory framework that has lowered barriers to entry.
They added that European regulation sought to strike a balance between competition and incentivising the long-term investment required to build and run high-quality, gigabit fixed fibre connectivity, and that in contrast to mobile, fixed access, including ducts and poles, remains a de facto natural monopoly across much of the European Union (EU) and is impossible to fully replicate.
They said: “To serve European businesses and enterprises, operators must also offer connectivity at a variety of urban and rural sites. Given that only incumbent operators have nationwide coverage, wholesale access remains key. It is therefore alarming that the European Commission is now proposing to relax regulation on former fixed monopolies.
“This approach contrasts starkly with the principles of competition as a driver for investment that the Commission has rightly championed for decades. And it would entrench dominance, notably in underserved areas, imperilling the pace of full-fibre infrastructure roll-out and gigabit-capable services for millions of Europeans.”
The operators also stated bluntly that if the EC departed from the established ex-ante model or removed all markets from the Recommendation on Relevant Markets (RRM) regulations, it would significantly undermine regulatory certainty. They said this would result in a less competitive investment case for fixed telecoms in Europe, “stranding billions of euros committed by the private sector” and reducing investor sentiment.
Moreover, they argued that the current EC proposals would further suppress future take-up of services by consumers and businesses, inhibit network innovation, and make it more challenging for Europe to achieve its Digital Decade 2030 targets.
In a call to action, the telcos urged the EC to enshrine a predictable framework for fixed infrastructure based on the following principles: preserve the ex-ante model to spur competition and investment in the sector and increase consumer choice and take-up; ensure access to physical infrastructure, including ducts and poles; complete the Digital Networks Act before considering changes to the RRM framework.
The letter concluded with the operators arguing that long-term investment in fibre networks depends on regulatory certainty, but that Europe’s Digital Decade 2030 ambitions can only be achieved if the commission adopts a balanced, evidence-based approach to regulation of the fixed telecoms market.
“Without this, Europe’s digital future will continue to falter as global competitors race ahead, leading to weak productivity growth, stagnant living standards and a less secure continent,” they wrote. “We therefore call on the Commission to work closely with industry and national regulators to ensure that the regulatory framework continues to support both investment and competition for all players.”
