Telecommunication Market and Regulatory Developments 2011

19 June 2012
by eub2 -- last modified 19 June 2012

Greater data consumption and a shift to mobile technologies (such as smartphones) and mobile services (such as 3G internet, music streaming and webmail) are the most significant trends in the information & communications technologies (ICT) sector, which now accounts for 8 million jobs and 6% of EU GDP, according to the Annual Digital Agenda scoreboard.

The report issued on 18 June 2012 outlines a number of key trends and achievements:

    Demand for data is exploding: 95% of Europeans have access to a fixed broadband connection, while the use of mobile internet has gone up by 62%. The huge potential growth for data traffic volumes opens up new business opportunities for the telecoms sector and online service providers. Data represents 7.6% of total industry revenues for individuals and households with revenues from mobile data services up almost 10%.

    To support consumers' demand for mobile internet services, a significant amount of radio spectrum was freed up during 2011: Belgium, Lithuania, Slovenia, Greece, Malta, Spain and Portugal opened up the 900 MHz and 1800 MHz bands ("GSM bands") to new mobile services, while the 800 MHz band was assigned to mobile broadband in Spain, France, Italy, Portugal and Sweden.

    Consumers, overall, got better deals for mobile services. The average revenue per user (ARPU) dropped in many Member States with the average EU level decreasing from EUR 244 in 2009 to EUR 221 in 2010. Thanks to progress in implementing the EU rules on termination rates, the fees networks charge other networks for delivering mobile voice calls, mobile termination rates went down to 3.87 cents per minute in 2011 compared to 5.47 cents per minute in 2010.

The report also points to area where targeted measures are needed to make the most out of the EU regulatory framework:

    Member States need to implement the updated EU telecom rules which were agreed in 2009. To date, four Member States (Belgium, Poland, Portugal and Slovenia) have not yet transposed these rules into their national legislation These rules guarantee more competitive markets for consumers and businesses and give EU customers new rights, such as switching their phone operator in one day without changing the number or being informed without delay when their personal data is stolen online. In terms of implementation, the Commission is particularly concerned about issues like the independence of regulators, consumer protection (in particular over the adequate implementation of EU rules on number portability) but also specific taxes on operators where infringement proceedings are ongoing against Hungary, Spain and France.

    There are major variations in the price of broadband access products such as the price alternative operators pay to use incumbents' networks to provide services to customers where the monthly average wholesale price for access to the 'local loop' varies between EUR 5.3 in Poland and Slovakia and EUR 14.4 in Finland. This shows the need to increase regulatory consistency in areas like the costing methodology of broadband access products and non-discriminatory remedies.

    Up to 80% of the costs of rolling out high speed broadband networks are related to civil engineering, such as the digging up of roads to lay down fibre. The Commission believes this high percentage calls for harmonised measures to reduce these costs and is envisaging an EU initiative in the beginning of 2013.

    Member States are taking divergent approaches on the issue of net neutrality and quality of services which slows down the development of the digital Single Market. Recent analysis from BEREC - the body of European network regulators - shows that at least 20%, and potentially up to half of EU mobile broadband users have contracts that allow their Internet service provider to restrict access to services like VOIP (e.g. Skype) or peer-to-peer file-sharing. This shows the need for co-ordinated action to ensure better consumer information and choice of internet services.

Report

Source: European Commission