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Steelie Neelie calls for copper price cuts to drive fibre

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The EU's top digital eurocrat has called on large telcos to stop using copper pricing as a barrier to deploying fibre networks.

"Telecom operators are divided on the question of how copper access prices affect the incentives for fibre investment," said Neelie Kroes during a speech in Brussels today.

"Alternative operators consider that copper access prices are too high given that the assets are largely depreciated. And they argue that, as a result, incumbents prefer to make good, easy profits on legacy infrastructure rather than invest significant amounts in new fibre networks."

Kroes added that those operators think that lowering the copper price would allow "incumbents" to pump cash into fibre networks.

The likes of France Télécom and BT have argued that bringing those prices down could be bad news for broadband retail prices.

"[Incumbents] consider it would be unattractive to invest in a parallel fibre infrastructure directly competing with a cheap copper network, at a time when many consumers do not yet appreciate the major difference, in capacity and service quality, between the two technologies," said the unelected digital czar.

Kroes made those comments as she announced public consultation on the pricing of access to broadband networks.

She proposed that such pricing should be gradually lowered for what she described as "largely depreciated copper networks."

Under that plan, big telcos responsible for such infrastructure could slowly begin investing in fibre networks, while phasing out the copper networks.

"Clients could then be migrated to fibre, and benefit from better services and applications for which higher wholesale and retail prices could justifiably be charged. Such a mechanism should also reassure markets that investment in fibre is safe and profitable," she added.

Brussels plans to pump €9.2bn into "broadband investment and pan-European digital public services" between 2014 and 2020. Kroes said that €6.4bn of that funding pot would be used for broadband infrastructure "largely in the form of equity, debt or guarantees. The Commission and EIB would also provide credibility, and improve the projects' credit rating by absorbing part of the risk."

The commissioner added that wireless technology was "a major component in the policy mix". She wants to get every one of the 500 million people living and working in the 27-Member bloc to have digital access.

Meanwhile, Kroes has asked BEREC (the body of European regulators for electronic communications) to provide the commission with facts and figures on transparency, blocking, throttling and switching.

All of which neatly led to Kroes taking a swipe at the Dutch rushing in with their own "net neutrality" rules.

"It is very important that we wait for the facts and figures before acting. And if we do need to act, we must do so in a coordinated way across Europe," she said.

"I regret very much that The Netherlands seems to be moving unilaterally on this issue. We must act on the basis of facts, not passion; acting quickly and without reflection can be counterproductive.

"For example, requiring operators to provide only 'full internet' could kill innovative new offers. Even worse, it could mean higher prices for those consumers with more limited needs who were ready to accept a cheaper, limited package." ®

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