The GSMA, which represents the global interests of mobile network operators, has warned the new EU Commission that failure to reform regulations around telecoms could end up harming businesses across Europe. Speaking exclusively to TechInformed ahead of this year’s Mobile World Congress in Barcelona, GSMA head of Europe and CIS Laszlo Toth claims the European Union […]
The GSMA, which represents the global interests of mobile network operators, has warned the new EU Commission that failure to reform regulations around telecoms could end up harming businesses across Europe.
Speaking exclusively to TechInformed ahead of this year’s Mobile World Congress in Barcelona, GSMA head of Europe and CIS Laszlo Toth claims the European Union risked falling behind other regions such as the US if politicians fail to grasp the opportunities offered by mobile technology such as 5G.
Europe welcomed a new Parliament and a new Commission in 2024, with the latter led by German politician Ursula von der Leyen in her second term as President.
The GSMA, which represents the interests of mobile operators across the globe, recently welcomed the Commission’s Work Programme for 2025, which included plans to tackle telecoms regulation across Europe.
Architecting a new path for telecoms: GSMA’s European head, Laszlo Toft
But Toth – who shares the same name as the architect depicted in this year’s Oscar nominated film The Brutalist – warns that significant change is needed to prevent the EU from falling behind other markets.
He says: “We think there is an important, very significant need in Europe to reform telecoms policy.
Europe, he adds, is “lagging behind” other geographies despite being an early leader in mobile technologies.
Now, however, the telecoms sector in Europe “faces significant challenges that impact investment, innovation, security,” while also threatening the continent’s competitiveness, Toth says.
“We find ourselves in a global tech race,” he adds. “If we don’t do anything, Europe will risk falling further behind, not just in telecoms, but in general, with the entire economy at risk.”
Poor connectivity in Europe, he explains, risks becoming a bottleneck for innovative technologies such as AI or industrial innovation.
His call came as the GSMA published its Mobile Internet Connectivity Infrastructure Investment Landscape report in partnership with global management consulting firm Kearney.
The report found that $127 billion is invested in mobile infrastructure every year, $109 billion of which comes from Mobile Network Operators – 85% of the total investment in mobile internet connectivity infrastructure globally. This, the GSMA says, highlights the contribution of the mobile sector to economies.
Fragmentation in regulation
One of the key challenges for the EU, according to Toth, is that the regulatory environment across the European is fragmented. This is due to the fact that each member has their own rules and regulations for telecoms operators, as well as some European wide regulations, that has led to a lack of harmonisation.
“The single European telecom market hasn’t emerged,” adds Toth, despite EU efforts to develop consistent regulatory frameworks in the sector.
“We have frameworks which are defined in a directive with national implementation, but are very different in different member states.”
National regulators have also hindered efforts from the telecoms companies to grow and cross borders.
Another challenge for telecoms is that while new technologies, such as voice-over-IP and OTT messaging, have opened up the sector to a range of new players, these new rivals aren’t regulated in the same way as telecoms companies.
Finally, Toth explains that in the GSMA’s view, the telecoms market has been “weakened over the years by chronic overregulation”.
“We accumulated a lot of regulation on top of each other, but this has led to policymakers micromanaging the sector,” he adds. “There’s a big need to simplify and streamline regulation to reflect the new dynamics.”
How is 5G contributing to Industry 4.0?
This, he explains, should see a reduction in regulation in the sector overall, but the GSMA also believes commissioners should consider extending the scope of any remaining regulation to include all digital players.
Also, regulators should look at harmonising rules across member states to allow operators to promote pan-European services. This, he adds, would bring better scale, meaning operators would see greater return on their network investments, allowing them to go further and provide better connectivity.
Across the spectrum
One of the most costly elements for telecoms operators is acquiring spectrum licences, especially as they look at expanding 5G services, and being to look at a 6G future.
Research from Ericsson found that, European telcos spend a significant portion of their capital expenditure on spectrum – up to 35-40% of total capital expenditure – equating to roughly 7% of their mobile service revenue on average across Europe.
Toth says that one of the biggest challenges for operators was that some member states “treat spectrum like a windfall tax” instead of seeing distribution of the bandwidth as a key part of creating a competitive connectivity landscape.
Toft believes European telecoms companies need to fight their corner
In Germany, for instance operators paid €66 billion on licences fees between 2000 and 2019 – money that, according to Toth, could have instead been used for network investment.
“We think that with more harmonised rules EU spectrum policy could deliver a wider adoption of best practices and enable a more long-term and more harmonised approach to life,” he says.
“Licensing, it is particularly important, not just with the new spectrum bands coming for not necessarily 5G but 6G or later, but also for renewals.”
What happens if the EU Commission fails to engage with these issues?
Toth says it could stifle economic growth, harming businesses and the wider tech sector, and make Europe less competitive with the US and Asia.
“There’s a growing demand for capacity in Europe, particularly with new services,” he explains.
“AI and industrial use cases are coming to the fore, but if the underlying technology cannot grow with the capacity needs, then that is a problem and we will see innovation take place elsewhere.
“We need urgent action, in terms of clear and practical solutions to make sure EU policy making keeps up with markets and technologies that are rapidly evolving.”
Ministerial presence
The GSMA – has been running Mobile World Congress in its current form for almost 20 years, and the annual Barcelona showcase is attended by around 100,000 tech executives, mobile leaders, politicians, journalists, and members of the public.
European Commission President, Ursula von der Leyen
This year, Toth explains the new commission is also expected to attend, giving him and his fellow GSMA executives an opportunity to relay their concerns in person.
The GSMA also runs a ministerial programme, which welcomes politicians from across Europe issues such as regulation, AI governance, mobile spectrum and the impact telecoms can have on the global economy.
Toth says he expects to spend most of his week in the Ministerial Programme, but encourages attendees to leave the meeting rooms to explore the show floor across the Fira’s eight halls.
“I have visited many MWCs,” he concludes, “and I expect this to be the biggest one of them all. It will be a great show.”
