In a groundbreaking move, the European Union is considering a shift in its telecom merger regulations and a broader scope for telecom rules, aiming to enlist the support of Big Tech in financing the widespread adoption of 5G. A document from the European Commission, revealed by Reuters, suggests a potential relaxation of rules governing mobile telecom mergers. Notably, major players such as Deutsche Telekom, Orange, Telefonica, and Telecom Italia have persistently lobbied for a more lenient approach to mergers that may reduce the number of mobile operators from four to three.
The document, set to be presented by Commission Vice-President Margrethe Vestager on Feb. 21, highlights the challenges posed by a fragmented market with around 50 mobile operators and over 100 fixed operators across the European Union. It emphasizes the potential hindrance to operators’ ability to invest in future networks, especially for cross-border services. The proposal prompts stakeholders to consider whether cross-border consolidation or alternative forms of upstream cooperation could provide the necessary scale without compromising downstream competition.
Furthermore, the document suggests expanding the scope of current telecom rules due to the convergence between electronic communications networks and cloud services. The European Commission is contemplating a broader regulatory framework to ensure a level playing field and equivalent rights and obligations for all digital network actors and end-users.
A notable aspect of the proposal involves telecom providers advocating for major tech giants such as Alphabet Inc’s Google, Meta, Amazon.com, Netflix Inc, Apple, and Microsoft Corp to contribute to the funding of network upgrades. These tech giants, collectively responsible for over half of internet data traffic, are seen as potential contributors to the evolving digital landscape.
The upcoming presentation on Feb. 21 aims to gather feedback from stakeholders, marking a significant juncture in the EU’s approach to telecom regulations and its collaboration with Big Tech in the era of 5G expansion.
