General principles on regulating telecommunication markets in the EU (commenting on concerns regarding Deutsche Telekom)
am 21.11.2005 von http://mehrsprachigkeit.blogspot.com
The basic feature of the EU regulatory framework for electronic communications is that markets must be regulated.
It is obvious that through liberalisation of, for example, fixed voice telephony markets no competition will occur by itself. The reason for that is how markets of telecommunications have developed historically: the most important feature is that there is one firm which holds most of market shares. This firm in all cases is the successor of the former state monopolies and it owns the infrastructure which was developed over many decades before. It is important to understand that developing alternative infrastructure is very costly and in many cases economically unviable (for example it is senseless to dig up all streets to provide an alternative connection of fixed telephony to all houses). Therefore, in many cases the only sensible option for ensuring competition is allowing the competitors to use the existing network.
To ensure that such an access is operational the National Regulatory Authorities of Member States need to regulate such things as inter-connection, terms of using the existing network, remuneration for thar etc. If this was not done the former state monopolies could simply ignore the attempts of new entrants to negotiate access to its network: they have enough market power to disregard these new entrants. If this happens, no competition will ever occur.
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