Nine months after the Commission’s Digital Networks Act proposal, the ITRE Committee’s Draft Report takes positive steps towards addressing the challenges facing Europe’s mobile operators; however, some inclusions raise significant concerns about undermining the digital ecosystem, in particular the changes to roaming, which risk disincentivising investment and increasing fraud.
The Draft Report recognises how Europe’s competitiveness, for too long lagging on the global stage, correlates directly to its digital capabilities. These can be strengthened by a DNA that prioritises the mobile industry’s ability to invest, that promotes innovation and that facilitates simplification, creating the conditions for better networks, innovative services and greater choice for European consumers.
Indefinite or long spectrum licence terms provide the regulatory certainty operators need to commit to long-term network investment and upgrades. Automatic renewals will further strengthen investment predictability, especially with 500 spectrum licences up for renewal across Europe over the next decade. Together, these measures will help create a more stable and investment-friendly regulatory environment.
While this represents progress, it could be undermined by the proposed EU-level allocation of portions of spectrum, which could reduce the spectrum available for national assignments and distort competition in national markets. Reaching pan-European scale should be the result of market-driven processes supported, but not substituted, by an appropriate policy framework.
There is also pragmatic recognition of the regulatory imbalances the mobile industry has long faced in comparison with other, similar services. The report proposes overdue improvements in the approach to applying the same rules for the same services and levelling the playing field, along with a stronger cooperation and conciliation mechanism.
However, some of the revised measures will have unintended consequences that will negatively impact or jeopardise the strengthening of the digital ecosystem.
In particular, tearing down the existing system for European roaming, where safeguards against permanent roaming form an inherent part, risks fundamentally distorting competition in the market.
It would enable price arbitrage, and would weaken incentives to invest if wholesale payments do not adequately support the maintenance and upgrading of these networks. This would lead to uncontrolled traffic costs, create new fraud, security and enforcement risks from a weakening of customer identification, and could also benefit players who do not contribute comparably to EU network investment, when regulation should encourage and safeguard investment.
There is no need for further intervention in the roaming rules, which already enable favourable conditions for customers under the ‘Roam Like At Home’ principle, and which must remain sustainable for operators.
Ultimately, a digital society and digital economy cannot function without digital connectivity. The DNA is our best opportunity to address longstanding barriers to European digital excellence.
This all underpins Europe’s competitiveness, its invention and innovation capabilities, its security, its industry and, in the modern age, its identity. Lawmakers must keep building towards a DNA that matches the needs and expectations of European industries and consumers alike.