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Victoria Mindova

The European Commission is ready to allow big telecommunication companies to raise the prices for access to their networks. The aim is leading companies in the sector in Europe to ensure more stable and higher financial flow, after they are ready to invest or have already invested in the most modern telecommunication infrastructures.

The Commissioner for Digital Agenda, Neelie Kroes, proposed to lower regulation over service prices, offered to the former state telecommunication giants, most of which are private today. The greater flexibility in pricing is expected to activate private stockholders' investors interest.

From the new measure will benefit mainly telecommunication companies, which, until recently, has been monopoly state players on the local markets, as Telecom Italia, Deutsche Telekom and France Telecom. Neelie Kroes's plan has to be implemented, so that the big companies to be able to reinvest and renew existing networks. The expected investments to be made are 270 billion euro, for which the income flow of the companies owning the already existing infrastructures will have increase. Alternative suppliers on the market saw a threat in this proposal for the return of monopolies from the past. They don’t agree with the foreseen possibility big corporations to regulate by themselves the prices of rented networks.

This decision concerns directly the Greek telecommunication company ОТЕ, in which a major shareholder is the German Deutsche Telekom. At the end of the previous month, a representative of the Greek ОТЕ said specially for GRReporter: "As part of OTE’s strategy on the refinancing of its debt maturing in the next two years, amounting to 3.4 billion euros, which includes both extending its maturity profile as well as reducing overall net debt, the Group explores the potential sale of its fully owned subsidiaries Globul and Germanos Telecom Bulgaria and intends to initiate the relevant procedure."

It is not excluded the freer pricing policy to change ОТЕ's plans for sale to the Bulgarian branches Globul and Germanos, but for now there is no official position on the question. At the moment, ОТЕ has moved 100 million euro for the construction of a very-high-bit-rate digital subscriber line (VDSL). It is partially created, but cannot be put into exploitation due to regulatory obstacles. The National Committee for Telecommunications has not approved the retail prices yet, offered by ОТЕ, although the deadlines for the final decision were a month ago.

The European Commission criticized severely the over-regulation on the Greek market. The European body sent a letter to the National Committee for Telecommunications, informing the supervising body, that it should give more freedom to the main market operator to define retail prices, so that not to disturb the balance between ОТЕ's expenses for investment and income from sales.