EU says more effort needed to boost broadband use

EU says more effort needed to boost broadband use

The European Union's 300 billon euro ($470 billion) telecoms market grew 1.9 percent last year when it saw investment up for a fifth year running, but more needs to be done to boost broadband use, the bloc's top telecoms regulator said on Wednesday.

EU Telecoms Commissioner, Viviane Reding, said only eight of the bloc's 27 member states were ahead of the United States in broadband use, with Denmark, Finland, the Netherlands and Sweden world leaders with nearly a third of homes hooked up.

"These EU countries, together with the United Kingdom, Belgium, Luxembourg and France, all had broadband penetration rates higher than the United States in July 2007," Reding said in her annual update on competition in telecoms markets.

Broadband use in Europe reached 20 percent overall, still lagging the 22.1 percent in the United States.

The EU executive body sees increasing the use of broadband as key to boosting competition in the retail sector, offering consumers more choice and driving down prices.

Broadband is also seen as key to helping set up new businesses, particularly in more remote regions.

However, there is considerable scope for further consumer benefits from a reinforced single market, strengthened competition and reduced regulatory burden for market players, Reding said in a statement.

"The European regulatory model is designed to increase competition in the telecoms market and this certainly is starting to pay off," Reding said.

"However, the job is not yet done. Competition is limited for access to the fixed network which is still provided to 86.5 percent of customers over the incumbent's infrastructure," she said in reference to former state-owned monopoly operators such as Deutsche Telekom and France Telecom.

Investment in telecoms in the EU last year was over 50 billion euros, in line with the United States and higher than in China and Japan combined.

Some 19 million broadband lines were added in the EU in 2007, the equivalent of more than 50,000 households every day in a sector that generated estimated revenues of 62 billion euros.

Meanwhile, the mobile phone sector continues to be the largest telecoms market, with revenues last year up 3.8 precent at 137 billion euros.

Fixed voice telephony revenues fell five percent last year but Reding said fixed operators were compensated by strong growth in their broadband services, generating revenues of 62 billion euros.