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EU Approves UK Broadband Deregulate
By: MarkJ - 14 February, 2008 (1:19 PM)

The European Commission (EC) has accepted proposals by Ofcom to deregulate parts of the UK broadband access market where competition is strongest. The EU's Telecoms Commissioner, Viviane Reding, hopes that other member states will be able to follow suit by building equally competitive markets in their own countries.

Ofcom, the UK's communications regulator, welcomed the move and expects to publish a statement on the issue in the spring, following completion of its consultation process on the proposals:

The Commission confirmed that Ofcom's proposals for regulating this sector are consistent with the rules set out in the EU framework - and that the decision to tailor regulation to local competitive conditions through the identification of sub-national markets is justified.

Ofcom's proposals include the removal of regulatory obligations in areas of the country where strong competition is now a reality, in keeping with its commitment to regulate only where it is necessary. The area covered by this proposed de-regulation accounts for approximately 65% of UK premises.

Naturally some consumers may be concerned that this will mean fewer rules to prevent ISP's and operators from abusing their market position, such as to set different service prices for the same products in different parts of the country, although Ofcom has promised that there will be no regulation-free nirvana.

Deregulation is only possible because Ofcom and the EU believe that BT has lost enough of its market power to make it less of an impeding threat to rivals. However quite what will happen now is difficult to judge, although we expect a great deal of market caution, at least at first.

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