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European Commission - Press release

Digital Agenda: €110bn jackpot on offer for completing e-Communications Single Market

Brussels, 28 February 2012 – The answers to Europe's search for new economic growth may be closer to home than expected. The European Commission today released a study showing that, if the internal market for electronic communications were completed, the EU gross domestic product (GDP) could grow by up to 110 billion euros a year, or more than 0.8% of GDP. e-Communications is a critical part of overall efforts to build a digital Single Market. This "digital bonus" for EU growth would result from more competition, increased economies of scale for telecom operators, and the chance for every European to access all online content and services throughout the EU, such as music, movies and video games. For example, new and more efficient economic activity could arise from the ability to subscribe to TV from your home country when living abroad, the possibility of receiving healthcare monitoring from your local physician while on holiday, or a business using a single Cloud computing provider for offices in many EU countries.

European Commission Vice President Neelie Kroes said: "We are wealthier and more competitive because of our Single Market. But it is not a true Single Market if the Internet and other telecoms are excluded. The digital Single Market is coffee for the economy, we'd be mad not to drink it."

The study was carried out by an international team of experts and academics. It suggests three main types of policy measures to tackle obstacles:

  • reduced regulatory fragmentation (e.g. common rules on contract duration and transparency of bills);

  • more European standardisation (to allow pan-European services of assured quality to emerge in areas such as e-Health, e-Energy, e-Mobility);

  • the need for more coordination of the activities of national telecoms regulators at EU level.

Investigating the cost of non-Europe in the telecoms market is a key objective of the Digital Agenda for Europe (see IP/10/581, MEMO/10/199 and MEMO/10/200). The Commission will hold a public workshop in May to receive stakeholders' suggestions on how to act on the issues raised in this study entitled ‘Steps towards a truly Internal Market for e-Communications.’

Background

In particular, the study looks into the reasons why many European telecoms operators do not enter other European markets where retail prices remain higher than in their national markets. A number of factors are blamed for this:

  • firstly, the lack of EU standards (for example, it is difficult for telecom operators in one Member State to get the same wholesale access product in another Member State and thus offer telecommunications services across Europe);

  • secondly, differences in the implementation of the European regulatory framework (for example, consumers can now change telecom operator and retain the same number. However, the technology to carry out such a change may be different in every Member State);

  • thirdly, lack of coordination of national spectrum policies leading to different speeds of adopting 4G (high speed mobile broadband).

The benefits of suggested action can be considerable. The study points to the fact that in the coming years demand for bandwidth will continue to increase. The drivers of growth will be online services such as movies and games (which will evolve from High Definition to technologies such as 3D, e-Health or e-Learning). These services require guaranteed quality of service. This requires pan-European standards, since what might work in one Member State may not be possible in another.

Every major review of the EU telecoms rules presents the Commission with an opportunity to re-assess the impact of EU policies against their initial objectives. Liberalisation of the sector has been a major success but there is still scope for much more progress in the development of the internal market for telecommunications.

The revised EU telecoms rules, which entered into force in May 2011, provide a backdrop to the study and the consultants have indicated a number of policy measures that could be taken by the Commission in the coming years to achieve a truly Single Market in e-Communications.

Useful links:

"Steps towards a truly Internal Market for e-Communications" study

Digital Agenda website

Neelie Kroes' website

Follow Neelie Kroes on Twitter

Contacts :

Ryan Heath (+32 2 296 17 16), Twitter: @ECspokesRyan

Linda Cain (+32 2 299 90 19)


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