High-speed network connections: Commission recommends leased line price ceilings
Prices for wholesale leased lines, which are a key source of broadband services for businesses should reflect the real cost of supplying them, says the European Commission. In a recommendation to Member States today, the Commission reports on 'best current practices' in wholesale leased line pricing and provides competitive market benchmark prices for the entire EU, in order to help Member States to devise regulatory remedies for leased line markets that are not effectively competitive on their territory. The EU single market for electronic communication services is distorted by substantial variations in leased line prices (for a 2 Mbit/s line, 5 km long, the price in the most expensive Member State is seven times higher than in the cheapest), which are hard to explain in terms of possible underlying costs.
Information Society and Media Commissioner Reding said: 'Leased lines are fundamental building blocks for the development of a world class high-speed communications infrastructure in Europe. Competitive pricing of leased lines will expand the range and cut the costs of electronic communications services that are made available to business users and end-users across the EU, and in particular to small and medium-sized enterprises, which have much to gain from lower prices for business services offered by operators making use of these inputs'.
Leased lines are the link offering high-quality symmetric and dedicated transmission capacity (from 64kbit/s to 155 Mbit/s) between two locations. Companies need them for accessing the Internet, for communicating with clients and customers, for transacting business and for communicating within their organisations, via e-mail, file-sharing, information systems, telephone and fax. Universities and research centres use leased lines to communicate and exchange knowledge and to offer students a high quality communications infrastructure for research and study.
Leased lines are provided by traditional telecom operators. New market entrants have their own networks but need to link their customers' premises to it. This link is called a 'leased line part circuit' and is usually provided by the incumbent. The availability at the wholesale level of these links at reasonable prices is a necessary condition for a competitive leased lines retail market and for pro-competitive downstream 'knock-on' effects. But the Commission's regular reports show that the substantial variations in wholesale prices that exist across the EU do not directly reflect the cost of supplying the leased lines
For more information please visit:http://europa.eu.int/rapid/pressReleasesAction.do?reference=IP/05/365&format=HTML&aged=0&language=EN
Information Society and Media Commissioner Reding said: 'Leased lines are fundamental building blocks for the development of a world class high-speed communications infrastructure in Europe. Competitive pricing of leased lines will expand the range and cut the costs of electronic communications services that are made available to business users and end-users across the EU, and in particular to small and medium-sized enterprises, which have much to gain from lower prices for business services offered by operators making use of these inputs'.
Leased lines are the link offering high-quality symmetric and dedicated transmission capacity (from 64kbit/s to 155 Mbit/s) between two locations. Companies need them for accessing the Internet, for communicating with clients and customers, for transacting business and for communicating within their organisations, via e-mail, file-sharing, information systems, telephone and fax. Universities and research centres use leased lines to communicate and exchange knowledge and to offer students a high quality communications infrastructure for research and study.
Leased lines are provided by traditional telecom operators. New market entrants have their own networks but need to link their customers' premises to it. This link is called a 'leased line part circuit' and is usually provided by the incumbent. The availability at the wholesale level of these links at reasonable prices is a necessary condition for a competitive leased lines retail market and for pro-competitive downstream 'knock-on' effects. But the Commission's regular reports show that the substantial variations in wholesale prices that exist across the EU do not directly reflect the cost of supplying the leased lines
For more information please visit:http://europa.eu.int/rapid/pressReleasesAction.do?reference=IP/05/365&format=HTML&aged=0&language=EN
