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September 7, 2016

Broadband fears prompt Europe to take a big step backwards

by John_A

Regulators in Europe are considering axing regulations around broadband services in order to foster investment in new fiber optic networks. Reuters claims to have seen an as-yet-unpublished document in which officials ponder relaxing rules surround infrastructure sharing. Currently, companies that install fixed-line broadband to homes are obliged to rent access to other businesses at a fair price. But those firms are aggrieved, saying that the fees aren’t enough to justify the initial investment.

Officials want to scrap the regulations at the European level and hand control back to the individual countries. Local bodies will be required to monitor the investment of telecoms and ensure that they’re building out as promised, or playing fair if others want to instead. The move is designed to encourage telcos to build out rural areas where the returns — it’s claimed — simply weren’t there to justify the initial cost.

The backstory to this is that the EU is spooked about its poor digital infrastructure, especially compared to the US and China. The Union’s digital chief, Guenther Oettinger, has said that the bloc needs to invest $800 billion just to remain alongside the two world superpowers. That’s not the sort of cash anyone in Europe has to hand right now, given the whole financial crisis.

Then again, the obvious concern here is that the EU is essentially turning a blind eye to a system that’ll create a series of local monopolies. If your town is cabled by one company and can block others from accessing its network, then customers will be trapped with one provider in perpetuity. That’s not likely to go down well with consumers or people who believe in free and fair markets.

Source: Reuters

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