A Political and Economic Dictionary of Western Europe, First Edition
The telecommunications sector has changed significantly since the 1980s on account of the growth in demand for global communications and technological innovations such as the internet. To address these new demands, the European Commission, business and liberal economies put pressure on European Union (EU) member states to deregulate and privatize their telecommunications industries. Traditionally a highly protected and subsidized sector granted special and exclusive rights by national governments, nationalized telecommunications industries provided a public service and were used in national economy policy-making. By the late 1990s telecommunications in the EU had been fully liberalized.
Telecommunications was excluded from the project to complete the Single European Market, but the European Commission published a separate Green Paper on the development of a single market for telecommunications services and equipment in 1987.
Commission directives in 1988, 1990 and 1993 liberalized, respectively, Customer Premise Equipment (CPE—hardware, computer terminals, telephones), Value-Added Network Services (VANs—fax, data transmission) and voice telephony. While economies such as the United Kingdom were quick to liberalize their telecommunications industries, and in fact sought much deregulation prior to the Commission directives, others, such as France and the southern European states, resisted change. The final directive set 1 January 1998 as the date for full liberalization; Ireland, Greece, Portugal and Spain negotiated an extension until 2003.
In parallel with the liberalization of telecommunications, the Commission issued a directive to ensure that the new competition would be fair and effective. The 1990 Open Network Directive set down the principles of mutual recognition of tests and licences, the setting of minimum European Community (EC) requirements and the establishment of voluntary EC-recognized norms and standards. Regulation directives are set at European levels and implemented and checked by independent national regulators.
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