Telecoms companies get Internet wake-up

Date: 12/04/01

By Peter Chapman

TELECOMS Commissioner Erkki Liikanen has issued a wake-up call to EU governments over the failure of their top operators to open up local networks to rivals.

A regulation agreed last year by member states forces the former monopolies to let competitors rent local telecommunications access without having to build their own systems at huge expense.

The law, imposing 'local loop unbundling', was meant to boost use of the Internet in the EU by allowing rival operators to offer super-fast new digital technology. But a survey obtained by European Voice from Liikanen's department reveals only a handful of customers across the EU have benefited from the ruling.

Operators in nine out of the 15 member states have not made any unbundled lines available, the survey found. Of those that offered access, only former monopolies in Germany, Denmark, the Netherlands and Finland have moved beyond the experimental stage.

The situation is even worse when it comes to a special category of unbundling known as shared access, which gives rival operators part of the local loop so that they can offer fast Internet services even as the traditional operator continues to supply other phone services. So far, not a single former monopoly has given this to a rival.

Shared access is seen by industry as the great hope for boosting EU Internet use because household customers are often reluctant to ditch their traditional operator for their voice telephone services.

Diplomats say Liikanen unveiled the survey on the sidelines of last week's telecoms ministers' meeting in Luxembourg.

Commission insiders say he is ready to give member states and operators extra time before launching a more vocal naming and shaming campaign. They say officials are likely to raise the issue at a meeting of EU and national telecom regulators in May. Industry critics such as Internet giant AOL Europe have been warning almost since day one that unbundling was a flop.

Simon Hampton, the company's director of regulatory affairs, says the failure of operators to offer shared access is denying customers access to better online services.

This lets the former monopoly operators dominate the market for fast new digital subscriber line (DSL) services, and gives Internet service providers owned by these companies an unfair cost advantage.

"The incumbents are offering their DSL services over the same line as the voice telephony - in other words they 'line share' with themselves already - so you'd never be competitive with their ISPs," Hampton said. "Line sharing solves the problem, by allowing the consumer to have a choice of who provides the DSL infrastructure but without forcing them to change voice provider."

Telecoms Commissioner Erkki Liikanen has issued a wake-up call to EU governments over the failure of their top operators to open up local networks to rivals.