Is a Europe-wide network coming?
There are rumblings and murmurs that a pan-European network may be coming soon. It is an issued that has been talked about recently but recent developments are the most concrete steps seen yet toward a European fully-integrated mobile telephony network. The rumours come following a private meeting between some of the continent’s biggest telephone companies with EU bigwigs also attending.
Recently, mobile phone companies have been performing poorly and have seen profits tumble in the wake of the global financial crisis. Investors are putting the pressure on especially after all the investment in 4G across Europe. In order to try to recoup their revenues, many European networks are restructuring their businesses over the coming years.
One thing driving development is an urging from the EU headquarters to make more concerted effort to combine the multitude of network across the continent. Brussels recently mandated EU-wide payment caps on mobile phone usage across Europe much to the relief of consumers everywhere. It’s now thought they will press for a stronger union amongst the fragmentation of telephonic utilities.
The latest meeting brought together some of the biggest players in the industry. As well as T-Mobile owner Deutsche Telekom, Orange owner France Télécom, and O2 owner Telefónica, there were also representatives from Telecom Italia. Together, the four companies bring in revenues of about €200 billion making them truly massive multinationals. Furthermore, EU competition chief Joaquín Almunia also attended making the private meeting full of some of the biggest movers and shakers involved in mobile phones.
Industry experts have concluded that the results of the meeting was that all the leaders agreed that joining together Europe’s networks would be beneficial. It is thought that the fragmented European telecoms markets make the industry less competitive. As most of the mobile networks originated from state-owned monopolies originally, the market has grown in a more disjointed way than many other in Europe.
However, the aim to create a pan-European network will encounter several roadblocks on the way, not least from the EU regulators. There will also be difficulties reconciling the various national laws and regulations of communications. Added on to that the financial and technical obstacles in uniting the various infrastructures and it becomes clear how gargantuan a task this will be.
However, it is thought that united the various national operators will modernise the telecoms industry and bring benefits for consumers. It will also more closely resemble other major mobile network markets such as that in China and the US which are totally dominated by just a handful of providers. The possibility of reducing roaming fees and simplifying pricing across the whole EU would also be a massive benefit for end users.
Despite the obvious challenges, it is thought that this latest meeting represents one of the biggest first steps toward setting this plan in motion. This is very much a preliminary stage but there is good reason for speculation. And, after all, the networks are nowadays under increasing pressure to share the burden of investment and work together for a share of ever-diminishing margins.
What do you think? Is there any basis in these rumours? And would it be better to have a EU-wide mobile network? What do you see as the main benefits to consumers?
HTC, the Taiwanese mobile phone manufacture, has just posted troubling financial results. The latest figures show that net income has fallen almost 100% compared to last year. The net income for HTC was only £21.2 million – shockingly this is the lowest since 2004 when far fewer smartphones were being sold.
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