EC says telecom competition limited in Cyprus

The European Commission has noted that competition in the telecom market in Cyprus still appears to be very limited, possibly partly due to both retail and wholesale pricing issues in the fixed and mobile markets.

The EC noted that competition among telecom operators in the EU in general has drastically cut the cost of making phone calls over the past 20 years.

In the 1980s, traditional telecom monopolies controlled all forms of telecommunications – voice and data. They also controlled almost all equipment attached to the networks, and themselves issued licences and conditions for others to use their networks.

Starting with handsets in 1988 and progressively adding services until 1998, the EU liberalised all telecom goods and services. The effect was dramatic. The number of fixed-line telecom operators doubled between 1998 and 2003. New entrants invested in new services and infrastructure, and consumers got a better deal all round.

Between 1996 and 2002, EU telecommunications services grew much cheaper. On average, for the same telecom services, consumers spent about 30% less of their income in 2002 than they did 1996, and the affordability index for average income users in all EU Member States sank to a record low in 2002.

Since 2000 the EU weighted average charge of a 3 minute call has fallen by 65% and the cost of a 10 minute call by 74%. There were useful reductions in prices 1 for both 3-minute (15.3%) and 10 minute

(17%) national calls during the year to mid-2005.

The EC basket of the highest and lowest price ranges in the EU shows that Cyprus scored the lowest (cheapest) among the EU in terms of medium and high usage at 12.7 and 20.0 respectfully compared to the UK being most expensive.

The Commission is concerned that a comprehensive directory and/or enquiry service is not provided in the Czech Republic, Greece, France, Cyprus, Latvia, Malta, Poland, Portugal, Slovakia and the United Kingdom.