Regulation and the promotion of investment in next generation networks-A European dilemma

The paper discusses the dilemmas facing European regulators (the European Commission and the national regulatory authorities) over the promotion of investment in Next Generation Access Networks (NGANs). Whereas the US has adopted a deregulatory approach and parts of Asia takes an approach linked to industrial policy considerations, the EU has largely left the process to operators working subject to a framework of regulation of access. While this may be enough to elicit investment where there is competition among networks, the incentives to invest are weaker where there is only one fixed network, as is the case in most of the territory of the EU. In reaching this view, the paper examines the prospects for competition from both wireless and,municipal networks. It recommends that steps be taken fully to mobilise incentives to invest ill NGANs where there is competition. Elsewhere, it may be necessary to consider a broader range of policies to create conditions for investment. (C) 2008 Elsevier Ltd. All rights reserved.