Weak regulation slows telecoms services - survey

The lack of adequate penalties and uncertainty caused by the appeals process is undermining regulation of the Irish telecoms sector. These weaknesses are leading to problems with the provision of mobile phone services and broadband products, a survey of 16 EU states shows.

A regulatory scorecard survey published yesterday by the European Competitive Telecommunications Association (ECTA) warns that investment in the telecoms sector is being put at risk because governments and regulators are allowing historic telecoms monopolies to re-establish their grip on national markets.

It cites research showing that investment in the electronic communications sector in Ireland amounted to 0.38 per cent of gross domestic product in 2003. This ranks the Republic 12th out of 16 states, behind countries such as the Czech Republic and Britain, which had investment of 1.4 per cent and 0.61 per cent of GDP respectively.

Measuring investment on a per capita basis, Ireland performs better, attracting €144 investment per person in electronic communications infrastructure, ahead of states such as Spain, Portugal, the Netherlands, Italy, France and Germany.

The chapter on Ireland notes that, since the submission of the first appeal in August 2004 to the Electronic Communications Appeals Panel, 12 out of 16 decisions by the Commission for Communications Regulation (ComReg) have been appealed. In addition, Eircom successfully sought a judicial review of a decision intended to help to open the incumbent operators network to competition, says the report.

Despite the uncertainties created by inadequate penalties and the appeals process, the ECTA scorecard shows the Irish regulator performs relatively well in implementing EU legislation and keeping interconnection fees low. It is ranked fifth overall in the survey, a drop of three places on 2004, for effectiveness of its regulation.

The publication of the report coincided with a meeting of EU telecoms ministers in Brussels, which discussed an upcoming review of the EU regulatory framework. One of the key questions that will be addressed is whether regulation should be lifted from dominant operators such as Eircom when they build next generation networks.

ECTA, which represents the interests of competing firms, is lobbying to maintain tight regulation of incumbent firms.