European broadband access growth rates have slowed dramatically since last year. Growth rates of 10 percent since the beginning of the third quarter of 2007 are significantly lower than the 16 percent rate seen from the first quarter to third quarter of 2007. That is congruent with slower net additions seen in the U.S. market as well, suggesting that broadband penetration is nearing a saturation point.


Competitive providers in Europe are worried about prospects for the future in a different sense, though. So far, E.U. regulators have mandated robust wholesale access to existing copper access facilities owned by the large telephone companies. According to the ECTA, a competitive carrier trade association, 82 percent of broadband lines now rely on leased copper local loops. About 14 percent of lines are leased from cable operators.

But ECTA members are worried about what could happen in the future if carriers get permission to build new fiber-to-home facilities and then are freed from the obligation to provide wholesale use of those facilities by competitors. And that is precisely what the dominant carriers now are seeking.

The ECTA says that if carriers are not required to lease their new optical access facilities to competitors, those competitors will increase their market share from the current 50 percent level up to as much as 80 percent.

In the U.S. market regulators have taken a different approach, essentially granting the dominant telcos that sort of freedom in hopes of stimulating robust competition with cable companies.

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Gary Kim (News - Alert) is a contributing editor for TMCnet. To read more of his articles, please visit his columnist page.

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