Scaling of European operators: Northstream studies the effects of the EC Connected Continent legislative package

A major telecom actor asked for Northstream’s assistance as part of evaluating the effects of the EC proposal for the Connected Continent legislative package. One of the drivers for change according to the proposal is that Europe has fallen behind the US and other markets in terms of LTE investments.  According to the proposal the EU market is very fragmented and therefore, a connected continent means consolidation in the telecom sector to give telecom operators bigger scale to be more competitive global players and increase their ability to expand and invest.

Northstream analyzed the key concepts in the EC Proposal and studied a number of group operators in Europe to find evidence whether they are able to leverage scale benefits today to perform better and more efficiently than local players. Northstream then analyzed how the preconditions for scale would change if the EC proposal is accepted. As part of the analysis, Northstream also studied the US market and the reasons US operators have invested more in LTE in order to determine if Europe can duplicate these market conditions.

Northstream provided conclusions on whether the EC proposal’s intended effect of allowing operators to leverage better scale through consolidation would lead to increased infrastructure investments and consumer benefits.