The GSMA and ETNO, industry associations representing fixed and mobile network operators, have called for European policymakers to take bold action to secure EU connectivity leadership over the next decade.

In a joint response to the European Commission consultation on “the future of the electronic communications sector and its infrastructure” the associations state that Europe is at an inflection point, with policy change urgently needed to create the right conditions for future European leadership in connectivity and prevent the continent from falling further behind its global competitors.

Future of connectivity: a whole new game

Already today, 5G, IoT and edge computing have started empowering sustainable economies and societies across Europe. Tomorrow, telecom technology will be marked by network virtualization, with ‘telcos’ transforming into ‘tech-comm’ companies and shifting connectivity functions to the public cloud.

Currently, Europe is affected by a network investment gap of at least €174 billion, and telecom markets are overly fragmented. What is more, the relationship between telecom operators and Large Traffic Generators is currently imbalanced, with traffic from a small handful of multinational companies driving huge network costs which are shouldered exclusively by telecom companies and their customers. This hinders investment in future networks, leaving European citizens and businesses at a global disadvantage.

In this scenario, Europe’s Open Strategy Autonomy is threatened and the EU’s bold ambitions for future leadership in connectivity are put into question.

Policy changes: a fairer deal for all EU connectivity

In response to the consultation, ETNO and the GSMA have proposed urgent policy changes in Europe. Such changes would ensure the continent stays ahead of the curve in 5G, FTTH and new cloud technologies, supporting the inclusive roll-out of new networks and empowering the important green-digital transition. The associations’ response proposes:

• Creating a real European telecom single market by simplifying regulation, including for telecoms rules, spectrum policy, consumer protection, taxation and harmonised security frameworks;
• Building scale through in-market consolidation, as a stepping-stone for a healthy European telecom market;
• Introducing a fair contribution mechanism that allows balanced negotiations between telcos and large traffic generators. Such large traffic generators currently derive the most benefit from telecom investment, whilst simultaneously creating a high-cost burden via their traffic and exerting disproportionate power across markets.

Lise Fuhr, Director General, ETNO, said: “A strong telecom sector is in Europe’s strategic interest, as secure and innovative networks are the backbone of our society. This requires a better balance between powerful tech giants and European telcos, but also improved market scale. Policy change is required so we can achieve the EU Digital Decade targets and accelerate the green transition.’’

John Giusti, Chief Regulatory Officer, GSMA, said: “Now is the time for European policymakers to act boldly to ensure a world-leading digital economy for citizens across the continent. By simplifying regulation, supporting economies of scale through consolidation, and ensuring that huge international companies benefitting the most from access to European consumers pay their fair contribution to the network investment they rely on, Europe can secure the connectivity needs of its citizens and businesses for today and tomorrow, enabling a robust digital and green future for all. For Europe to regain digital leadership, it must start looking forward and no longer cling to the failing regulatory models of the past.