The European Commission has over the years been chipping away at how big carriers have milked European consumers in areas like international calling charges and broadband usage for certain content. Now, in a spirit of getting the region of 28 disparate nations to behave as one, the regulators have taken their biggest swing of the bat yet: a new legislative package that proposes to cut out international calling premiums and services that offer different broadband speeds depending on the content broadcast; and on the carrier side new rules that would effectively cut down red take to make Europe into a single market.
The Commission, which formally laid out its intentions today but has been working on them for a while, is calling the plan its most ambitious in 26 years. If it gets approved, it could have huge implications not just for consumers and their big carrier overlords, but also on newer players like OTT video providers and startups offering networked services.
But whether the EC will ever manage to get big carriers and countries to agree to it will be another story. We’ve already seen lobbyists making pre-emptive attempts to scupper the proposals, with Europe forging ahead anyway. If approved, the first changes could start to take effect by July 2014.
“Further substantial progress towards a European single market for telecoms is essential for Europe’s strategic interests and economic progress,” EC president Jose Manuel Barroso said in a speech today in Brussels, “for the telecoms sector itself and for citizens who are frustrated that they do not have full and fair access to internet and mobile services.”
VP Neelie Kroes, the Digital Agenda commissioner who has long been arguing for these changes, was behind this new package. “The legislation proposed today is great news for the future of mobile and internet in Europe,” she said in a statement. “The European Commission says no to roaming premiums, yes to net neutrality, yes to investment, yes to new jobs. Fixing the telecoms sector is no longer about this one sector but about supporting the sustainable development of all sectors.”
Right now, the EC estimates that telecoms services account for 9% of Europe’s digital economy “because all sectors increasingly depend on connectivity to be globally competitive and deliver services.” The idea is that by bringing down some of these existing barriers, that percentage — and the economy — will grow. Despite many years of incremental reforms, “there is no telecoms company that operates across the whole EU, and both operators and customers face differing prices and rules,” the Commission noted in a statement today.
Here’s the run-down of some of the highlights of the new proposals, with the latest draft of the proposals, and a summary, embedded below that.
Single set of rules for carriers to follow: Those who are rolling out services across all 28 markets in Europe would need only a single authorization rather than 28.
No more roaming premiums on inbound calls: From July 2014, no more incoming call charges across the EU. Also carriers will either offer single European price plans or the ability to let consumers easily select carriers that offer calling plans outside a user’s home market. (Since 2012, carriers already have been forced to offer cheaper prices for mobile data; this builds on that.)
No more roaming call charges outbound: This applies to both mobile and fixed calls and would make the price of a call within the EU the same price as a call in your home country. (Long distance becomes the same price as local.)
Net neutrality: Making sure broadband carriers are not short-changing consumers over certain content by throttling speeds has been a long-argued issue in Europe and other parts of the world. This is the EC’s attempt to right the issue once and for all here. Carriers will not be allowed to block or slow down delivery of certain content; they will however be allowed to offer different kinds of services that allow for some streaming (such as data-intensive video) and not others. Users who feel they are getting shortchanged can walk away with no penalties, or as the EC puts it, “the obligation on providers to provide unhindered connection to all content, applications or services being accessed by end-users – also referred to as Net Neutrality – while regulating the use of traffic management measures by operators in respect of general internet access.”
Consumer protection: Plain-language contracts that are easier to read; formal rules to make it easier to switch providers if promises are not met; and doing away with the status quo of two-year contracts (especially in mobile) are among the proposals here.
Spectrum: This is a wonky proposal but a significant for longer-term growth. Basically, it gives carriers the right to link up with operators in other regions to better manage and buy new spectrum for WiFI and 4G, although it looks like deals still need to be made on a country-by-country basis.
Kroes’ office is expected to give a further presentation tomorrow drilling into some of the more technical aspects of the proposal.