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October 03, 2011

Telecom Operators Rip Into EU Fiber Proposal
By Erin Harrison
Executive Editor, Strategic Initiatives

European telecom operators are up in arms over a new proposal by the head of the European Union that seeks to grow investment in faster fiber optics networks, according to news reports.

The proposal, which aims to reduce profits generated on copper-based networks, was nixed by nearly a dozen telecom operators, “saying it was wrongheaded and would actually stunt progress,” Reuters (News - Alert) reported Monday. The heads of several European telecom companies came out against the proposal just minutes after EU Commissioner Neelie Kroes outlined the plan in a speech at an industry conference in Brussels. According to news reports, Kroes told the audience she was seeking public comment – the first step of any EU regulation – “on what prices large operators who own the ageing copper telecoms networks should be able to charge competitors for access,” the Financial Times (News - Alert) reported.

France Telecom, Telefonica and Telecom Italia were among the telecom operators who spoke out against the plan.

Telecom Italia CEO Franco Bernabe called the idea “simply crazy,” Reuters reported, claiming that the new parameters “would serve only to handicap further the industry at a time when it was already suffering from falling revenues and profits,” the report said.

“We need lower taxes, less regulation, a good operating environment, and more profits. Instead we are getting the opposite,” Bernabe said on a panel at the conference, according to Reuters.

Kroes added that she would open a discussion period to debate the merits of the proposal and “whether to reduce the amount telecom operators charge rivals to rent their copper-based telecom networks,” according to the report which would allow for operators to “present credible plans to invest in fiber networks [and] could be exempt from the lower rental charges.”

The EU is lagging behind its own “Digital Agenda” that calls for all Europeans to have access to broadband and by 2020 at least 50 percent of European households should subscribe to Internet access above 100 Mbps, Reuters reported.

Erin Harrison is Executive Editor, Strategic Initiatives, for TMC, where she oversees the company's strategic editorial initiatives, including the launch of several new print and online initiatives. She plays an active role in the print publications and TMCnet, covering IP communications, information technology and other related topics. To read more of Erin's articles, please visit her columnist page.

Edited by Rich Steeves


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