EU’s Breton urges rethink on cross-border telecoms mergers

EU industry chief Thierry Breton urged antitrust regulators on Monday to consider allowing more cross-border mergers in the European telecoms industry, backing calls by Deutsche Telekom, Orange, Telefonica and Telecom Italia.

EU antitrust chief Margrethe Vestager has been reluctant to allow telecoms providers acquire EU peers without hefty remedies, especially when deals reduce the number of players from four to three, underlining concerns about the market power of fewer but larger telecoms operators.

The telecoms industry however said consolidation is required to pool resources to roll out costly fast-speed broadband and 5G.

“I believe that creating a true single market for telecommunications services also requires a reflection on encouraging cross-border consolidation, all while preserving fair and necessary competition for the benefit of our consumers,” Breton said in a speech to be delivered at an event in Helsinki.

On the issue of whether Alphabet Inc’s Google, Meta, Amazon.com Inc, Netflix Inc, Apple Inc and Microsoft Corp should bear some network costs, Breton said the European Commission will launch a consultation this month on the topic.

“The investments which will be required to achieve our ambitions will be enormous and we need to ensure that they are matched by the availability of sufficient funding. The burden of this financing should not be only on the shoulders of the member states or the EU budget,” he said.

“At a time when technology companies are using most bandwidth and telco operators are seeing their return on investment drop, this also raises the question of who pays for the next generation of connectivity infrastructure,” Breton said. Reuters