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Regulation vs. Competition in the light of technological market developments Brussels, 30 May 2005. Jan Tjernell Director Legal & Regulatory Affairs. Europe’s regulatory situation – not yet satisfactory. Countries are delaying the introduction of the new framework
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Regulation vs. Competition in the light of technological market developments Brussels, 30 May 2005 Jan TjernellDirector Legal & Regulatory Affairs
Europe’s regulatory situation – not yet satisfactory • Countries are delaying the introduction of the new framework • unclear legal transitory situation and opportunity for former monopolists to maintain and increase market shares • Former monopolists continue to abuse their dominant positions • higher prices for consumers and businesses • The deregulation is not finished
Deregulation has been a success for customers Competition No competition Local calls -3,4% Fixed subscription National calls +25% -31% International calls -40% Time period 2000-2004 Source: 10th Implementation report from the European Commission
Technology Migration will reduce the deregulated addressable market (as of today) DSL & VoIP • Question is not if, but rather • In what timeframe? • To what extent? PSTN & DSL & VoIP Size of Market PSTN & DSL PSTN & DSL PSTN Time Today addressable for CPS and OCBC
Price control and cost accounting must contribute to harmonisation • Accept that there will be no nation wide replication of the “last mile” • Today the investment ladder is not sustainable as regulation is inconsistent or non existent Resale, where available Required for fast launch and full coverage Unattractive conditions, thus questionable business model Regulatory environment in most countries too unknown/uncertain to base any strategy in bitstream Huge investments Time consuming to roll-out and likelihood of incumbent obstructing 1 Bitstream 2 Own ULL 3