Network investment needs regulatory clarity, simplicity – Magenta Telekom

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Magenta Telekom CTIO Volker Libovsky on stage at Network X in Vienna.(Source: Tereza Krásová/Light Reading)

If governments want operators to invest in the infrastructure needed for AI, they need to provide regulatory certainty and simplicity, Volker Libovsky, CTIO at Magenta Telekom, Deutsche Telekom's Austrian unit, argued during his presentation at Network X today.

One of the crucial aspects is legal certainty. Telcos cannot commit to investments over multiple decades without knowing how the regulator will approach things like price adjustments, value creation or changes to customer experience, he argued.

In a similar vein, he said operators need to have certainty their investments in spectrum for terrestrial networks will be protected, having spent massively to secure it.

Another important condition is to simplify regulation, he said, adding it currently takes more than a year to get approvals for tower sites. "We have a lot of bureaucracy to cut through to implement networks, both on public ground and private ground," he said.

While Austria is a relatively small market, others in Europe have voiced similar concerns. Earlier this year, Vodafone called on the EU to ensure the Digital Networks Act brings regulatory simplification, urging the bloc to remove regulatory duplication to create a better investment environment.

The GSMA has for its part argued the DNA will bring "complexification" of the market through the introduction of more sector-specific rules.

In the UK, meanwhile, Virgin Media O2 has recently warned that the country's planning system sabotages mobile coverage in London, saying sites are shutting down faster than they can be replaced. Neos Networks' CEO Lee Mayall also last year told Light Reading that lengthy permissions processes are holding back the buildout of backbone fiber networks in the UK.

Flattish revenues

Libovsky also seemed to revive another long-standing gripe of European operators by complaining about the perceived unfairness of telcos investing billions into their networks without this yielding a corresponding boost in revenues.

"We have invested billions into our networks worldwide, both in spectrum, in fixed and mobile infrastructure, and of course, the supporting systems," he said. "Still, our revenue growth, our service revenue growth, is flattish. This is not fair," he added.

His argument was that telcos do not get a fair share of a value pool they create – something European telcos have complained about at length. Still, Libovsky didn't revive the call for "fair" contributions from largest sources of traffic, something that even Deutsche Telekom CEO Tim Höttges says the company has given up on.

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