Wednesday, March 30, 2005

European Commission Recommends Leased Line Price Ceilings

In a bid to boost competition, the European Commission is recommending that its Member States adopt price ceilings for wholesale leased lines that reflect the real cost of supplying them. A report from the Commission recommends "best current practices" in wholesale leased line pricing and provides competitive market benchmark prices for the entire EU.

The report finds that the EU single market is distorted by substantial variations in leased line prices. For a 2 Mbps line, 5 km long, the price in the most expensive Member State is seven times higher than in the cheapest.

"Leased lines are fundamental building blocks for the development of a world class high-speed communications infrastructure in Europe. Competitive pricing of leased lines will expand the range and cut the costs of electronic communications services that are made available to business users and end-users across the EU, and in particular to small and medium-sized enterprises, which have much to gain from lower prices for business services offered by operators making use of these inputs," said Information Society and Media Commissioner Viviane Reding.

The new price recommendations cover wholesale leased lines at 64 kbps, 2 Mbps, 34 Mbps and 155 Mbps and for line lengths of up to 2 km, up to 5 km, up to 15 km and up to 50 km.

  • In January 2005, the European Commission recommended that binding delivery deadlines should be introduced for the wholesale leased lines needed by suppliers of high-speed electronic communications services. Leased line delivery times vary substantially across the EU: for 2 Mbps lines, the delivery time in the slowest Member State is five times longer than in the fastest.


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