Competition (not consolidation) drives growth in France

Sep 26, 2013

The other networks in France - Orange and SFR - are also racing to complete their LTE upgrades. The reason for this sudden conversion to network investment?

Competition of course. The much-publicised arrival of Iliad's Free last year and its subsequent snaffling of 10 per cent of the French market following a price war (prices were down overall by 11 per cent last year) has shaken up the existing players just as it should. They're investing like crazy.

With this sort of result it's not surprising that Reuters had earlier reported that as many as nine EU commissioners were objecting to key parts of Neelie Kroes' plans for EU telecoms sector rationalisation, according to an EU 'official' who naturally didn't want to be named.

Squabbles between commissioners are usually kept behind closed doors and so far in this saga, they have been, but the Kroes plan has already drawn fire from the EU Competition Commissioner, (see - Touchie-Feelie Neelie not ambitious enough) and from BEREC, the European telecoms regulators' club (see - European regulator club challenges Kroes' consolidation fixation) as well as from the usual public interest groups.

It's hardly surprising, therefore, that other commissioners are are worried.

Top of the objectionable list is Kroes' plans to curtail net neutrality by allowing Internet Access Providers to arrange special deals with content and service providers to favour traffic where special treatment is warranted (to remove jitter from high definition video streams, for instance, or to ensure connectivity for health-oriented M2M applications).

Such arrangements are anathema to net neutrality adherents as over time they see them helping the slide to an inevitable two-tier Internet.

To provide covering fire for this aspect of the package Kroes and her spin doctors have spent the last months pushing her intention to ban Internet blocking and throttling and force greater broadband performance transparency. They have presented these policies as proof of her net neutrality credentials, while barely mentioning the rather more sinister, but blander-sounding 'special arrangements' (which would you rather suffer - blocking, throttling or a special arrangement?).

But Kroes is not just fraying net neutrality at the edges, she's aiming to touch up the rules and regs around things like harmonized spectrum allocations. Again, lots of effort is going into making this all sound innocuous and helpful to the industry. After all, why not have harmonised spectrum allocation so that a mobile operators can operate on a pan European basis with ease?

Answer: because such a policy would greatly favour large European incumbents and pretty-much lock out any challengers forever.

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