Backed by Draghi, European Commission President Ursula von der Leyen is promising to change that. She’s asked her competition commissioner nominee, Spain’s Teresa Ribera, to review merger rules with an eye to the “investment intensity of competition in certain strategic areas.” That in turn is hoped to spur new investment in digital networks to help Europe catch up with the power of Big Tech in the U.S. and the flurry of challengers coming from China.
For European telecom giants it is a “whatever it takes” moment to deliver the connectivity ecosystem that the sector needs to put the EU back on the map, Alessandro Gropelli, director general of lobby group Connect Europe that represent Deutsche Telekom, Telefónica and Orange, said in an interview.
But smaller telecoms operators, consumer advocates and competition enforcers fear the push could see customers paying more with no guarantees of better results. European consumers on average pay €16.15 for 20 gigabytes of mobile data compared to €37.87 in the United States, a recent study by the European Commission showed.
Margrethe Vestager, the EU’s outgoing top competition enforcer, also clapped back at Draghi’s report earlier this month, saying: “We have not seen proof that bigger businesses invest more.”
‘Dwarves here in Europe’
In his report, Draghi blamed Europe’s legal framework that had led to a “multiplicity of smaller players,” as well as the “costly proliferation” of laws across the 27 member countries.
That’s led to operators investing less in upgrading networks, which “may represent a risk for industrial companies in a phase when state of the art infrastructure is required to digitize manufacturing, supply and distribution chains,” Draghi wrote.
