The EC Review of Telecommunications Regulation
The European Commission is undertaking the first fundamental review of the telecommunications regulatory framework since 2009. This initiative is driven by a range of significant structural changes identified by the Commission, including the continuing migration from copper to fibre access networks, fixed/mobile convergence, retail bundling and the emergence of over-the-top (OTT) services that are rapidly transforming the traditional telecommunications markets.
Since the liberalisation of EU telecommunications markets across the 1980-90s, economic regulation of the sector has focused on using regulation to open up markets, promote competition, free up economic bottlenecks and enable access to key inputs. More recently, there has been a trend towards less retail regulation with a focus on targeted wholesale regulation. However, whilst the sector and its investors are making the argument for the relaxation of regulation, it is not inconceivable that the Commission’s review will lead to increases in the scope and depth of regulation of the European telecoms sector.
Critically, the review contemplates redefining communications services to include elements of social media and instant messaging, and considers the merit of imposing ex-ante regulation on these services. The Commission also suggests that increased regulation of retail markets might be appropriate, there is a real risk of both increased regulatory intervention, and a greater degree of uncertainty as to outcomes arising from lengthy interaction between the EC and member state regulators.
Network operators and their OTT counterparts, would be well advised to engage early and effectively in the consultation process before it concludes in December.