a week in wireless

A Week in Wireless – Too much Europe

The M&A frenzy of recent months seems have gone off the boil, presumably to allow all the company lawyers to take their new yachts in their maiden voyages. But in less than interesting times you can always count on Europe to come up with something.

The headlines have all been about Greece, its money problems and what this means for the European political project, on which more later. But on the telecoms side of things the good old Digital Single Market initiative flexed its muscles this week by finally setting a date for the abolition of roaming charges across the EU.

While this is immediately a matter for European operators, the motivation and implications of the move extend far further. The ultimate stated reason for this from a European Union perspective is to diminish national boundaries and create more of a sense of a ‘united states of Europe’. The logic seems to be that if we’re not worried about bill shock we’ll all communicate with each other a lot more.

That’s a lovely idea and, as both a mobile phone user and enjoyer of Europe, great news for the Informer with summer holiday season imminent. But while it will be great to be able to impose smug poolside images on a long-suffering social media constituency, free from the spectre financial ruin, it’s not immediately obvious how much more of a model European the Informer will be as a result.

You can break down all the barriers you want but the language one will still remain, especially for us Brits. Whatever linguistic magic potion they give kids in Dutch schools that results in them speaking seven languages fluently, while riding a bike, before breakfast is clearly not available over here. We feel pretty pleased with ourselves if we can ask for a croissant and a baguette without eliciting a baffled shrug, so where all this trans-European conviviality is going to suddenly come from is unclear.

Maybe the EC thinks it’s only bill shock anxiety that’s holding us back and that the prospect of being able to chat to Francois or Ingrid on our standard tariff will send us scurrying off to language night school. More likely, however, is that summer 2017 will see new records set for hot dog legs uploads and other such narcissistic fun.

And then there’s culture. Even if we do learn the lingo one of the great things about being a European is how different we all are. We’ve spent millennia fighting countless wars to reinforce this point and while we’ll happily visit each other’s countries on holiday, we’re always secretly relieved to come back and leave all that strange TV and foreign muck behind us.

This is the real challenge the European project has to overcome if the united states of Europe is to be achieved. You’re trying to get 700 million people, speaking over 20 different languages, with a rich history of violent disagreement, to all point in the same direction. Good luck with that.

Which brings us back to Greece. After years of negotiation, horse-trading, brinkmanship and mounting hysteria this week was supposed to be the moment of truth. Greece would either come to a new agreement with its creditors and with Europe or it would default on its debts, whereupon the four horsemen of the apocalypse would commence a grand tour of Europe.

But the end of June arrived, no deal was struck, Greece defaulted and… everyone just moved along as soon as they realised there’s nothing to see here. Having had its bluff called, and despite having been voted in on a ‘no austerity’ platform, the Greek government decided to hand the  decision on whether to accept the terms of the latest bailout package beck to the electorate in a referendum that is due to take place this weekend.

The result is still in the balance and the current government has indicated the referendum is essentially a confidence vote in which a decision to accept the current terms will probably result the collapse of the current administration and yet another election. But to some extent it’s all academic anyway as, regardless of who’s technically in charge, Greece is nowhere near being able to balance its books and it’s hard to see that ever changing so long as it’s currency is the euro.

This is another very important reason why it’s so hard to create a united states of Europe. Not only are there the geographical, cultural, linguistic and historical challenges, but its economies are very varied, especially when it comes to productivity. In the old days less productive European countries could remain competitive as exporters by devaluing their currency, thus making their goods and services cheaper to the rest of the world. Warmer countries such as Greece could also rely in a lot of revenue from tourism, which again was made stronger by a relatively weak currency.

So long as it remains part of the euro Greece will struggle to compete and thus turn around its macroeconomic fortunes. But the implications of Greece leaving the euro – often referred to as ‘Grexit’ – are considered grave for the project on the whole. While Greece may be a relatively small, peripheral part of the union, it’s thought the precedent set by letting even one member opt out could set off a chain of events that will eventually prove fatal to the EU.

Whenever the UK moans about losing sovereignty to Brussels and asks to be allowed to make some of its own decisions it is promptly scolded by some senior Eurocrat for its temerity. You can’t do Europe a la carte, we’re told; it’s all or nothing. If the Greek people vote for the latter, grand concepts such as the Digital Single Market may rapidly become overtaken by more pressing events.

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