Steps towards a truly Internal Market for electronic

Steps towards a truly Internal Market for electronic communications = Removing the remaining barriers= Single Market Event Brussels 2013 -06 -17 Dr. Ir. Wolter Lemstra w. lemstra@planet. nl +31 653 216 736 1

Purpose of the Study Smart 2010/0016 • Assess the state of progress of the EU Internal Market for electronic communications networks and services • Assess its economic potential up to 2020 • Costs of Non-Europe • Identify remaining barriers and formulate policy options for removal of these barriers Full-fledged Internal Market: (1) Openness + (2) Interoperability 2

(1) Openness of Markets: Key example – Optical networking Global Crossing Tele 1 Deutsche Telekom Tiscali/NETS Telecom Italia Telia 5000 -17000 Route-km: Ty. Com KPNQwest Interoute GTS COLT World. Com Level 3 LDCOM Viatel Enitel 3 (2) Interoperability of markets: Key examples – NMT and GSM

Current status of the Internal Market Current product/service offerings: • Equipment and terminal market is EU-wide (R&TTE) • Mobile services are perceived as EU-wide • Carrier’s carrier market, EU-wide, main corridors only • Services to Multi-National Corporations, patchwork And: • No operator serves EU-27 independently • Some operators operate in multiple countries • No operator fully exploits scale economies of EU-27 • No EU-wide end-to-end business rate services • No effective competition in mobile roaming 4 So: Is the potential of the Internal Market underutilized?

Assessment of Costs of Non-Europe • Openness of national markets: • Static efficiency + Dynamic efficiency • Moving to Best practice in 2009 • Interoperability of markets: • GSM as illustration/proxy • Comparing USA vs EU 1995 to 2009 • Sensitivity analysis € 110, 000, 000 5

Smart 2010/0016 Some of the main barriers observed • Cross border operations issues: • Heterogeneity in implementation of Regulation => Replication costs => Avoidable costs • Lack of IT interface standardization: • Operations Systems, Business Systems => Interoperability issues => No end-to-end service support => Long provisioning/repair time • Lack of Pan-European service offers - fit for business • Required by Multi National Corporations, multi sites, in cities and rural • Dependency on other sector regulation: • Privacy, national security => Hinders back-office integration • No distinction between consumers and business users => Unnessary costs e. g. consumer protection applying to business users 6

Recommendations • Policy makers and Regulators: • Close the loop: Evaluate the regulatory outcomes, measure the level of heterogeneity • Move from Recommendation => Directive Defining Harmonized standard => Effective enforcement • Apply Best practice for new Member States • Recognize business market needs, being different from consumers • Revisit the subsidiarity principle: • Trade-off local buy-in <=> 27 optimal solutions 7

The Challenge € 110, 000, 000 8

Imagine the Future It is Ours to Shape 9