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European Telecommunications Market: Liberalisation

Volume 623: debated on Tuesday 20 March 2001

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asked Her Majesty's Government:Whether they consider that the Lisbon European Summit's call for a fully integrated and liberalised telecommunications market within Europe by the end of 2001 will be delivered. [HL1077]

The Minister for Science, Department of Trade and Industry
(Lord Sainsbury of Turville)

The Government consider that four key elements will contribute to the delivery of a fully integrated and liberalised telecommunications market within Europe:

concluding work on the legislative proposals following the European Commission's 1999 communications review. The Government

welcome the fact that, by the end of June, the European Parliament and the Council will have undertaken first readings of the four most important proposals for Directives— Framework, Access, Authorisation and Universal Service & Users' Rights—arising from the 1999 review. It will continue to work to ensure that final agreement is reached as soon as possible on, these proposals as well as on others—on spectrum policy and communications data protection—that are not yet so far advanced in negotiation;

introducing greater competition in local access networks and unbundling the local loop. Fixed wireless access (FWA) offers a competitive alternative to wireline local access networks. The roll-out of FWA systems will be facilitated by harmonised use throughout Europe of the radio frequency bands identified by the European Conference of Postal and Telecommunications Administrations (CEPR). Many Community member states have already allocated these bands for FWA and have granted—or are planning to grant—licences to operators. The Government also welcome the Parliament and Council Regulation on unbundled access to the local loop that came into force in January. This provides valuable underpinning for further development and expansion of unbundling throughout the EU. In the UK the first loops have now been unbundled, and BT is accepting orders for co-location of other operators' equipment at all of its exchanges. OFTEL will continue to work with all interested operators to see that unbundling can proceed in accordance with commercial demand. The Government consider that the basis exists for a fully competitive market in higher bandwidth services to develop quickly;

meeting frequency requirements for future mobile communication systems in a timely and efficient manner. The Government welcome the recognition in the Commission's Communication on spectrum management of the value of spectrum as an economic resource and of the need for its effective strategic management. The precise mechanisms for Community involvement in the spectrum management process are being taken forward in negotiations on a proposal for a Decision of the European Parliament and of the Council on a regulatory framework for radio spectrum policy in the European Parliament. The Government are playing an active part in these negotiations, with a view to ensuring that Community involvement is truly strategic and does not duplicate the activities of the CEPT; and

ensuring the availability of low-cost, high-speed networks for Internet access. 34 per cent of UK homes and half of UK small businesses now have an Internet connection. Penetration in the UK is behind that in Scandinavia but ahead of the rest of Europe. OFTEL's international benchmarking programme showed that UK residential consumers had the cheapest or nearly the

cheapest prices for off-peak and peak services. Due to swift and early regulatory intervention, the UK is among the front-runners on unmetered Internet access and is one of only seven countries in the OECD to offer unmetered peak access. A number of Internet Service Providers, including BT itself, are already offering services based on a flat-rate wholesale interconnection product mandated by OFTEL. This will lead to an increase in both penetration and usage of Internet access in the UK. Action is also being taken by

OFTEL to ensure that leased lines, providing always-on access, are available on competitive terms to consumers.

The eEurope Action Plan 2002 is taking these actions forward at Community level and is on track. The Government fully expect the Stockholm European Council later this month to reinforce the importance of completing the integration and liberalisation of the telecommunications market and of ensuring rigorous enforcement of the Community regulatory framework based on competition principles.