TELECOMS/INTERNET : COPPER NETWORKS: OPERATORS DIVIDED OVER PRICING.

The European Commission's consultation on the way national regulators should calculate access prices to copper networks closed on 28 November 2011. The consultation caused some controversy: while it is championed by alternative operators, the possibility of reducing prices in exchange for investments in new optical fibre networks is strongly contested by ex-monopoly operators.

The consultation was launched on 3 October, along with another consultation on non-discriminatory access to networks (see box), to help the Commission draw up a recommendation for the application of tariff control measures. The aim is to help implement standardised conditions in the telecoms sector, to encourage competition and investment in the Union. The Commission's final objective is to ensure that all European citizens have access to fast and ultra-fast internet by 2020.

One of the most controversial suggestions that has emerged from this consultation is the option of modulating the - wholesale - price of access to copper networks in order to encourage operators to invest in new generation' (Next Generation Access - NGA) networks. These are cabled access networks which are completely or partly made from optical fibre and which can provide access to high-speed services - an improvement on existing copper networks.

Concretely, the Commission suggests reducing the income which big operators receive from renting out copper networks to their competitors in places (generally rural areas) where no investments exist. At the same time, the price of access to copper would not be reduced but could be increased - according to a specific calculation method - in places where operators have committed to invest in optical fibre. "Our target is to ensure that markets know that NGA investment is profitable for the long term," the Commissioner for the Digital Agenda, Neelie Kroes, told the European Competitive Telecommunications Association (ECTA), on 28 November. "So we are exploring whether copper prices could be gradually adjusted after a certain time, while allowing higher wholesale and retail prices for NGA products, and possibly also copper products for a transitional period, if operators commit to invest.

EXCESSIVE PROFITS

The ECTA is strongly in favour of reducing the cost of copper access and argues that dominant operators - who make excessive profits by renting out existing structures - do not have any real incentive to invest in optical fibre networks and prefer to...