The Financial Times reports that the idea of combining network infrastructure emerged at a private meeting between European Commission VP, Joaquín Almunia and the executives from Deutsche Telekom, France Telecom, Telecom Italia and Telefónica.
Several people familiar with the discussion told the publication that the executives left the meeting intent on exploring the idea, due to frustrations that the disjointed EU market has affected their ability to compete.
“The operators expressed a deep sense of frustration and agreed to bring constructive ideas of how a European market could work,” one person familiar with the meeting told the FT. “Objections won’t come from Europe, they will be from the [EU’s 27 national] regulators.”
Such a proposal would make the European market similar to the US and China, which are dominated by three or four larger players, and could bring consumer benefits in terms of pricing.
However, a network sharing agreement across the whole of the EU is unlikely to be easy to achieve due to both financial and technological constraints. Infrastructure and regulation also varies greatly from country to country.
The discussions have been deemed highly significant by industry insiders, as it is a critical time in terms of infrastructure investment. Both LTE and fibre roll-outs have been taking place across the continent, but the European financial crisis has hit telcos hard and limited investment.
The FT reports that one idea suggested to achieve the pan-European network is, similar to smaller scale network sharing agreements announced in the UK and Ireland, to pool network infrastructure under a new company along with debt and associated assets.
