GSMA's Bouverot sends operator-backed open letter to Kroes calling for European reform

The director general of the GSMA, Anne Bouverot, has sent an open letter to EC Commissioner Neelie Kroes calling for policy reform that will encourage investment in Europe’s telecoms sector. Bouverot secured endorsements from the CEOs of ten European operators with a combined European mobile customer base of almost three quarters of a billion subscriptions, according to data from Informa’s World Cellular Investors service.

The GSMA said that, despite Europe having the highest regional mobile penetration in the world, it was the only area in which revenues have declined, from €162bn in 2010 to €142bn in 2013. Despite this, the organisation said, “comprehensive policy reform” could enable the European mobile sector to drive investment, improve connectivity and enable innovation.

It is increasingly popular to compare Europe unfavourably with the US and Bouverot’s letter warned that European operators are “facing decreasing revenues and reduced market values compared with oeprators in the US and Asia,” as well as other players in the sector, for which read the internet and OS powerhouses. “This is impairing our ability to invest in the communications infrastructure needed to put Europe back on the path to growth and jobs,” she added.

Bouverot stressed the need for a regulatory overhaul that would enable operators to act unencumbered by “unnecessary layers of regulation”, drive greater harmony across the region and permit operators to consolidate to restructure the market.

She also called for “a level playing field for all”, a statement that again appeared to put internet players in her sights. Even-handed regulation “across the value chain” was needed, she said, as well as “consistent applications of rules irrespective of the technology being used, who is providing the service or where individuals are located.”

The Broadband World Forum is taking place on the 21st – 23rd October 2014 at the RAI Exhibition and Convention Centre, Amsterdam. Click here to download a brochure for the event.

Internet players like Google and Facebook (with its recent WhatsApp acquisition) have long been developing services that compete with operators’ core service offerings but attract none of the regulation that comes with a licence to operate a network. Moreover they are driving huge levels of traffic at little or no cost to themselves.

“Operators must have the commercial freedom to develop new business models, innovate at the network and service level, and offer customised services in order to restore the investment climate and drive innovation and competition in the global marketplace,” Bouverot said.

She also called for comprehensive reform of spectrum management policies and a fresh approach to privacy and security issues to improve consumer protection.

While many within the European community look to the leading US operators as evidence that revenue improvements are possible, critics of the US suggest that competition is limited, leaving consumers with too little choice. Meanwhile Kroes’ regulatory reform has focused very much on reducing the costs that must be borne by consumers of mobile telephony.

In recent conversations with Telecoms.com, Hannes Ametstreiter, CEO of Telekom Austria (and one of those name-checked in Bouverot’s letter) and Michel Combes, CEO of Alcatel-Lucent, have voiced similar opinions to those expressed by Bouverot.

The letter was endoresed by, Timotheus Höttges, CEO, Deutsche Telekom AG; Christian Salbaing, Deputy Chairman, Hutchison Whampoa Europe; Stéphane Richard, Chairman and CEO, Orange; Marco Patuano, CEO, Telecom Italia; César Alierta, Executive Chairman and CEO, Telefónica; Hannes Ametsreiter, CEO, Telekom Austria Group; Jon Fredrik Baksaas, President and CEO, Telenor Group and Chairman, GSMA Board; Johan Dennelind, President and CEO, TeliaSonera; Jo Lunder, CEO, VimpelCom; and Vittorio Colao, CEO, Vodafone Group.