Two telecoms relevant markets removed from EU regulation – consumers to feel the consequences?

This past October the European Commission announced that two electronic communications relevant markets are to be removed from the list of regulated markets the European Union.

Rise of alternative solutions

The markets in question are the retail market for access to fixed telephony and the wholesale market for fixed call origination. Both markets have been removed from the list of regulated telecommunications markets after an external report on future electronic communications markets subject to ex-ante regulation, and a public consultation that ran at the end of 2013.

The deregulation of the fixed call relevant markets comes as customers have been increasingly turning to alternative solutions, such as voice-over-IP (VoIP) and mobile calls. In addition competition in the provision of fixed call telephony has been increased, as customers are now able to purchase fixed access from a number of different platforms, such as traditional telephone network, fibre or cable networks, and also from alternative operators offering broadband and voice services over unbundled local loops.

In addition, the Commission also plans to redefine two broadband relevant markets in order to limit regulatory burdens to what is strictly necessary for competitive broadband access and investment.

Premature deregulation of relevant markets?

Incumbent telecoms operators welcomed the deregulation of the fixed telephony relevant markets saying it will boost investment in broadband infrastructure, as years of falling prices for calls and text messages have eroded operators’ revenues, reports Reuters.

However, smaller players that must rent capacity on networks from incumbents to allow customers to make fixed-line calls say that opening up the wholesale market could hurt their margins. Their view, shared by the EU’s group of national telecoms regulators, BEREC, is that such deregulation is still premature and that price increases will be passed onto consumers.

Comments Vesna Prodnik Pepevnik, Vafer’s CEO:

In the next few years we can expect significant technological changes in voice telephony; especially influencing the user experience and habits will be network convergence. I therefore believe that the regulation in question will not have a significant negative impact on end users in the long term.

By |2014-11-04T18:38:43+00:00October 30th, 2014|Latest News|Comments Off on Two telecoms relevant markets removed from EU regulation – consumers to feel the consequences?