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EU competition regulators are preparing new rules that will aim to rein in the incumbent operators it says are stymying internet uptake and creating a two-speed Europe.

In a statement, commissioner Viviane Reding said an unacceptable gap had developed between highly competitive broadband markets like the UK and those in newer member states. She said: "The gap between the strongest and weakest performers in Europe is growing. Europe must act now to get its broadband house in order."

She made the comments as the EU released a report on broadband penetration. It ranks Denmark top, with high speed access in 37.2 per cent of homes. High prices and poor availability mean Bulgaria and Romania limp online with just 5.7 and 6.6 per cent take-up respectively.

DSL technologies make up the majority of the EU broadband base, but fibre-optics and wireless are catching up, and are now used by 17.7 million, compared to 72.5 million for DSL.

Reding said her department will make proposals on November 13 to close the gap by increasing competition. Reforms will be aimed at tackling "regulatory weakness". She's a particular fan of the action taken by Ofcom to create BT Openreach, which must offer equal access to its competitors.

As we noted last week, however, one knock-on effect of the fierce competition has been rapid consolidation, cutting consumer choice.

The statement and a link to the full report are here.

In other news today, France's domestic competition watchdog slapped France Telecom - which owns Orange - with a €45m fine. It's been punished for a 2001 complaint by rival Club Internet that it was abusing its dominance of the Gallic broadband market. France Telecom didn't contest the fine and said its monopolistic days are behind it. ®

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