Telecoms Reform

The proposals would allow national regulators to split the network and retail divisions of providers deemed to have too much influence. They also foresee giving Brussels the ability to overturn national regulators' decisions and would create an EU telecommunications watchdog organization.

"From today onwards, a single market without borders for Europe's telecoms operators and consumers is not only a dream," European Commission President Jose Manuel Barroso said in a statement introducing the proposals on Tuesday, Nov. 13.

Advocates said the changes are also needed to increase investment in sectors like broadband Internet access and diversify the market, a step EU Telecoms Commissioner Viviane Reding said the regulations would make.

Revolutionary plans

"The changes the commission is presenting today in the telecoms rules is bound to revolutionize the European telecoms sector," she told reporters. "[The reform] will increase competition, leading to more innovation and investments, and it will help European citizens to get the most out of modern communication systems."

Reding also said the shake-up would "revolutionize Europe's telecom's sector and help it compete better with other continents in terms of globalization."

Industry analysts said the measures are aimed primarily at curbing the influence of giant former-monopoly companies like Germany's Deutsche Telekom, which sharply criticized the plan.

"The proposals of the commission will hinder investments of billions," Deutsche Telekom said in a statement.

Long way to go

The new rules, which could take effect by the end of 2009, have to be approved by the governments and parliaments of EU member states. Analysts said it's highly unlikely that countries like Germany, France and Spain will let the plans go through in their current form.

"Reticence is warranted," the German economy ministry said in a terse statement.

Critics, many of whom work for companies such as Deutsche Telekom, say the proposal would decrease investment in emerging technologies by increasing uncertainty on the market. There is also resistance to the idea of giving even more power to Brussels.

"Instead of helping get rid of the current competition problems, the new proposals needlessly risk hurting competition and will inevitably lead to more bureaucracy, decreased efficiency and loss of power for national regulators, as well as the elimination of jobs," Jürgen Grützner, head of the German Association of Telecommunications and Service Providers, told the AP news agency.

But representatives of new companies that compete with former monopolies welcomed the measures, saying that they would bolster competition and increase investment.

"It's very good news for competition and for investments in high speed broadband," Ilsa Godlovitch of the European Competitive Telecommunications Association ECTA, which represents smaller telecommunication companies, told Reuters.