Vestager calls for EU to centralise and consolidate telecoms

Margrethe Vestager.jpg

The European Union’s digital and competition commissioner has set out her goal for a “single European telecoms market” as what she calls “the only way to create the conditions to guarantee a return on investment”.

Margrethe Vestager (pictured), European commissioner for competition since 2014, said in an interview with Italy’s Milano Finanza that she wants only five to 10 operators across the EU market of 27 countries.

“The single European telecoms market is the only way to create the conditions to guarantee a return on investment,” she told the publication.

What she called “excessive competition” has “led to an acceleration of price deflationary dynamics”, said Vestager, who compared costs in Australia with those in Italy. In Australia the entry price is €30 for 40 gigabytes of traffic, she said. In Italy the same allowance is available at €5 – one sixth of the price.

“Under these conditions, the industry is no longer able to remunerate the investments necessary for the construction of the standalone 5G network,” said Vestager, adding: “Investments are now at risk everywhere.”

The commissioner said she wants licence revenues to be “managed centrally”, as EU level, “with mechanisms that would deprive states of a part of the revenue”.

And she wants consolidation, “at continental level”, though she accepted that would have “significant consequences in terms of employment”.

“Yet there is no other way, except to pass on the burden of investment to public taxation,” she told Milano Finanza. “The alternative is Europe’s progressive technological decline.”