Should next generation access networks fall within the scope of universal service? A European union perspective

In 2010 the European Commission (EC) undertook a review of its current Universal Service Obligation (USO) to discuss whether or not broadband should be included in it. In fact, convergence of telephony, internet and media, further market liberalization and rapid technological development in the broadband market challenge the traditional definition of USO and increasingly question its notion of a “basic set of communication services”, which does not include broadband. In this context, the paper looks at the origins, the theoretical arguments for, and the empirical basis of the USO in light of the ongoing debate in the EU, and links these arguments to technological developments and changing demand conditions in European broadband markets. The authors propose that the European Commission should include in its future USO regulation provisions for a wider set of services based on Next Generation Access (NGA) networks rooted in the EC's new regulatory approach. Even if these provisions have not been included in the new USO framework in November 2011 further discussions are needed to account for the new realities of broadband markets in the European Union.