The European Commission will take action against national regulators that allow unfair wholesale broadband price rises, its top telecom official has warned.
Neelie Kroes, the Commissioner for Digital Agenda, told members of the European Competitive Telecommunications Association (ECTA) that the EC would investigate member states that do not follow rules on rate rises, using a new law that comes into force next year.
She said Commissioner is concerned about the impact on consumers if national regulators approve steep rises in wholesale rates. Italy’s Agcom a request from Telecom Italia to up the fee by 24% last month, the New York Timesreported.
Kroes said the EC would issue guidance to regulators covering acceptable levels for wholesale price increases, and said her warning is “not abstract.”
ECTA director Ilsa Godlovitch said the guidance would help regulators “understand what the actual costs are,” rather than accepting figures provided by incumbent operators.
“It’s time for a reality check on regulated prices,” Godlovitch said, adding that national regulators “should be checking carefully if investments in fiber are as risky as incumbents claim.”
Agcom has subsequently amended its agreement with Telecom Italia, after the EC intervened following complaints from Vodafone and FastWeb.
It will now restrict the increases to €9.02 ($11.84) per month in 2011 and to €9.28 per month in 2012, rather than the respective €9.14 and €9.48 rises originally proposed.