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EC: Let's raise our broadband game
The EU is lagging…

By Reuters

Published: Thursday 20 March 2008

The European Commission wants to raise broadband internet penetration in the EU to 30 per cent by 2010, from 20 per cent today, in an effort to drive economic growth, its top telecoms regulator has said.

Information society commissioner, Viviane Reding, said only eight of the bloc's 27 member states were ahead of the US in broadband use, with Denmark, Finland, the Netherlands and Sweden world leaders, having nearly a third of homes hooked up.

In her annual update on competition in telecoms markets, Reding said: "These EU countries, together with the UK, Belgium, Luxembourg and France, all had broadband-penetration rates higher than the US in July 2007."

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Broadband use in Europe has reached 20 per cent overall, still lagging behind 22.1 per cent in the US.

Reding said she wants broadband penetration to hit 30 per cent by 2010 and that her proposed reforms of the telecoms market would help the EU reach this target.

She sees increasing the use of broadband as key to boosting competition in the retail sector, offering consumers more choice and driving down prices.

Broadband is also seen as key to helping set up new businesses, particularly in more remote regions.

Reding said she was confident that her reforms, now before the European Parliament and EU states for approval, would be adopted by April 2009, when parliamentary business winds down ahead of European elections in June.

The EU's €300bn telecoms market grew 1.9 per cent last year, with investment up for a fifth year running, showing EU telecoms rules were having an impact on boosting competition, Reding said.

In reference to former state-owned monopoly operators, such as Deutsche Telekom and France Telecom, she said: "However, the job is not yet done. Competition is limited for access to the fixed network, which is still provided to 86.5 per cent of customers over the incumbent's infrastructure."

Reding said the charges levied by one mobile-phone operator for handling another's calls were far too high and needed tackling.

Investment in telecoms in the EU last year was over €50bn, in line with the US and higher than in China and Japan combined, Reding said.

Some 19 million broadband lines were added in the EU in 2007, the equivalent of more than 50,000 households every day in a sector that generated estimated revenues of €62bn.

Some operators have accused Reding of wanting to over-regulate and make it harder to justify investment, but new entrants welcomed her comments.

The European Competitive Telecommunications Association, a lobby which represents new entrants, said incumbents just wanted to protect their strong market shares.