BRUSSELS-Telecom liberalization in Europe was pushed ahead last week when the European Commission adopted a policy requiring member states to begin to abolish phone monopolies and open mobile phone licensing.
The deadline set by the European Union for full liberalization is Jan. 1, 1998. The new directive goes into effect in late February, from which time member states have nine months to notify the commission of national measures taken to implement liberalization.
“This is not an overnight process, but it will mean they need to move faster rather than slower,” commented Brian Gibbons of Comcast International. Comcast recently sought the second cellular license offered in Ireland, but an Irish firm was selected.
Under the directive, mobile operators will be able to use their own infrastructure as well as that provided by third parties, such as utility companies. The intention is to give mobile operators flexibility.
Nations are required to ensure competition between established operators and entrants trying to gain a foothold in the mobile market. Restrictions on infrastructure and direct interconnection for mobile communications must be abolished immediately, the commission said. Member nations with less developed networks (Portugal, Greece, Spain, Ireland) can apply for extra time.
Encouraging competition now is important because it “will dampen the potential for increases in (fixed) local charges to the consumer,” the commission said. “The increasingly commercial incumbent (fixed link) operations are now set to position themselves to make the most of their local loop monopoly before the effects of full network competition are felt.” Decreasing mobile service prices will set a ceiling for wire-based local service, the commission stated.
There are more than 20 million wireless subscribers in Europe, according to EU figures. The mobile sector in EU telecom markets has experienced growth levels of more than 60 percent.
“The commission will be paying close attention to price adjustments in the telecom sector between now and 1998 in order to secure the maximum benefits of liberalization for consumers across the EU,” said the commission.
Commission studies predict there will be 38 million cellular phone users in Europe by 2000, and about 80 million by 2010. Technology standards approved by the EU include Global System for Mobile communications, DCS-1800 and Digital European Cordless Telecommunications.
