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Communications sector in Cyprus not fully liberalized, EU says.

The electronic communications sector in Cyprus has not yet grasped the full potential of a liberalised market, a European Commission report on telecoms communications says.

According to the report, the incumbent operator, 100% state-owned, maintains a very strong presence on the fixed, broadband, and mobile markets. Broadband penetration in the country reached 22.2% in January 2010, with Cyprus recording the highest number of new fixed broadband lines per citizen (4.0 lines per 100 inhabitants).

Mobile take-up reached 135.7% in October 2009, while mobile broadband gained only a marginal share of 1.1%, the lowest in the EU.

According to the Commission, delays in the auctions for frequencies for fixed wireless broadband access and for a third mobile licence, as well as rights of way procedures, have hampered the roll out of fixed and mobile networks and are impeding the development of competition on the retail market. Cyprus intends to move to full digital broadcasting by 11 July 2011, noted in the report.

As regards the general remarks of the report, consumers, businesses and the EU economy as a whole are denied the full economic benefits of a truly single and competitive EU-wide telecoms market because of inconsistent application of EU telecoms rules, according to the European Commission's annual report on the Single European Electronic Communications Market.

Most Member States' markets have become more competitive, but remain national in dimension. Moreover, the level of competitiveness varies strongly between Member States. Although Europe's telecoms sector weathered the financial storm in 2009 (0% growth compared to a 4.2% EU-wide economic decline), consistent enforcement of existing rules and investment in innovative services hold the key to future growth.

''Rapid growth of mobile broadband and more affordable internet access are good news for consumers in these tough economic times", Digital Agenda Commissioner Neelie Kroes said. "Yet the limited progress towards a true Single Market is disappointing. Member States need to do more to ensure telecoms rules are properly implemented and the necessary investments in innovative services made for the benefit of all 500 million European consumers'', she added.

As regards the prices for internet connections, the Commission notes that they have declined in 2009 thanks to flat rate offers and faster broadband speeds. For mobile voice calls, EU consumers paid 7% less than in 2008, with the average price per minute falling to 13 euro-cents from 14 euro-cents.

Consumers could switch their operator while keeping the phone number faster than before. On average, it took 4.1 days to do so for mobile and 6.5 days for fixed numbers in 2009 compared with 8.5 and 7.5 days respectively in 2008. Despite progress, more efforts are needed to reach the goal of one-day outlined in the 2009 EU telecoms rules.

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Publication:Financial Mirror (Cyprus)
Date:May 26, 2010
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