'Atom bomb' solution for fast net access

Incumbents must open networks to competition

Phone networks in the hands of monopolies across Europe could be legally separated or even sold off if incumbent operators fail to introduce competition.

This is the view of telecoms operator WorldCom's chief lawyer, Ann La France, speaking at a big internet providers conference in London on Wednesday.

Incumbent operators such as BT and Deutsche Telekom currently have a stranglehold on the last mile of network that connects users homes to telephone and broadband DSL internet services.

Impatience growing

Despite European Union directives forcing these operators to open up their networks to rivals, only 3% of the 4 million DSL lines in Europe are controlled by new entrants.

At the moment it can take over seven months to get a leased line installed in Germany and Ireland

Ann La France, WorldCom

The EU is getting impatient said Ms La France and some form of legal separation of the networks could be a real possibility if incumbents do not get their acts together she warned.

"This is the atom bomb solution waiting in the wings if incumbents continue to press for monopolies," she said.

One method of allowing rivals some access to incumbents' networks is via leased lines. International leased lines have been opened to competition and consequentially the prices have fallen by 90%.

Letter of complaint

In the local market, however, the lines are still firmly in the hands of incumbent operators and prices have fallen less than 50%.

WorldCom and 11 other ISPs have written to the EU complaining about the situation and demanding harsh penalties for incumbents who drag their feet.

"At the moment it can take over seven months to get a leased line installed in Germany and Ireland," said Ms La France.

"There are no penalties for incumbents deliberately being slow or else the penalties are so low that they take the view they would rather pay the fine and win the customer than lose the customer."

If ISPs continue to lobby the EU about the issue it could result in legal action against incumbents for abuse of their dominant position said Ms La France.