Reduced copper network access prices would hurt fiber, say EU groups

EU groups criticize European Commission proposals to reduce copper access prices

The European Commission's plan to lower access prices to copper networks in order to boost next generation networks is flawed, said Europe's leading telecoms organizations.

In October, Digital Agenda Commissioner Neelie Kroes revealed proposals to reduce copper access prices in a bid to encourage incumbent operators to invest in new fiber-based broadband networks. But a new study for ETNO (the European Telecommunications Network Operators association) shows that lowering the price of copper network access could have the opposite effect.

According to the report, carried out for ETNO by Plum Consulting, a reduction in the access price of copper would harm investment since it would lower retail prices in the market for both current and next generation access and thus reduce demand and lower the price for fiber, said the report.

It claims lowering copper prices would also reduce free cash flow, which is likely to reduce discretionary capital expenditure on infrastructure.

Cable Europe also described the Commission's approach as "a bit short sighted."

"It overlooks the competitive dynamic at work to which we're contributing. We're delivering in Europe today when it comes to competing with incumbents. With these solid competitive credentials, cable is a good reminder that there are natural market forces already at play and pushing incumbents to invest in next generation infrastructure," said Gregg Svingen, Cable Europe spokesman on Tuesday.

"It's also worth noting that every regulatory action has a consequence -- some can be unforeseen or unintended. Any wash-over effect on the overall market risks distracting investors in other parts of this crucial marketplace. We urge the Commission to consider less intrusive regulation especially as regards costing methodologies," Svingen continued.

But, said Kroes in October, alternative network providers claim that copper access prices are too high given that the value of operators' copper assets has largely depreciated. "For the time being, telecom companies are hesitant to commit significant funds to fiber rollout. As a result, incumbents prefer to make good, easy profits on legacy infrastructure rather than invest significant amounts in new fiber networks," she said.

The Commission is committed to fiber networks as a means of bringing high-speed 30Mbps+ broadband to every single European by 2020, with at least 50 percent having access to a 100Mbps service.

Follow Jennifer on Twitter at @BrusselsGeek or email tips and comments to jennifer_baker@idg.com.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags governmentbusiness issuesPlum ConsultingCable EuropeEuropean Telecommunications Network Operators

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Jennifer Baker

IDG News Service
Show Comments

Cool Tech

Toys for Boys

Family Friendly

Stocking Stuffer

SmartLens - Clip on Phone Camera Lens Set of 3

Learn more >

Christmas Gift Guide

Click for more ›

Brand Post

Bitdefender 2019

This Holiday Season, protect yourself and your loved ones with the best. Buy now for Holiday Savings!

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Featured Content

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?