Germany leads rejection of Euro uber-regulator

13 Nov 2007

The regulators of the 27 EU member countries have rejected calls by the European Commissioner for Information Society and Media, Viviane Reding, for a single telecoms regulator for the European Union. In a letter to Reding however, the European Regulators Group (ERG) of national regulatory authorities does advocate closer cooperation. Matthias Kurth, President of the German regulator Bundesnetzagentur (BNetzA) said, ‘National regulators are of the opinion that the decentralised structure is successful,’ adding that ERG members neither saw the necessity for a new authority nor that for a power of veto for the European Commission (EC) in regulatory decisions.

In an interview with German Spiegel magazine, Reding justified the plans for a EU regulatory authority as being a means for bringing down competitive barriers to create a free common market. ‘Today, national boundaries are a stumbling block for the telecommunications market in Europe,’ she said. Comparing the EU to the US and China, where ‘mobile networks range from San Francisco to New York… and from the Gobi Desert to Shanghai…and the same conditions apply to [all] phone calls’, she complained that the EU had 27 different systems. Reding is undeterred by the fact that the US and China are single countries, and the EU comprises 27 different countries. ‘Europe is more than ready for a single common telecommunications market,’ she said. To demonstrate potential benefits, she gave the example of the EU’s regulation of roaming charges which resulted in lower rates for international mobile calls.

Kurth claims that even without intervention by EU regulators, rates had come down considerably through the cooperation of the national regulators. He also rejects the notion that broadband coverage in Germany is inadequate due to a lack of competition in the German telecommunications market. ‘Germany now has a broadband penetration which is above EU average,’ said Kurth, pointing to papers produced by the EU commission itself which state that Germany was one of the fastest growing DSL markets in Europe. In addition, Kurth pointed out that prices were decreasing rapidly in the telecoms market as a result of fierce competition rather than EU regulation, which in turn promoted demand.