European businesses are still not getting fair prices on telecoms and networking services, despite promises of increased competition, according to one major user.
Nick White, head of technology and telecoms at Unilever, told users at TMA 32 in Brighton today that leased line charges in Europe remain several times more expensive than in the US, despite deregulation across Europe.
His presentation also included further damning statistics showing the high prices charged in Europe for leased lines. The European Commission last week approved recommended price ceilings for short distance leased lines that are up to a third the price of BT's list price.
"The opening of competition may be stifled at birth. Moore's Law, which is supposed to be faster in the telecoms world, does not yet appear to have reached the customer," said White.
"Telecoms is unique in holding back competition. In the developed world we still have monopolies. Competition - what competition?," he demanded.
Leased line prices are hugely inflated, according to White, especially when they cross national borders. He claims that the price of a 64Kbps leased line is marked up 100 per cent when it crosses a border, and a 2Mbps line is marked up almost 300 per cent.
"I fear Europe, including the UK is being left behind," said White, adding that businesses are turning to US based network providers for connectivity services, because their services are much cheaper.
"Can you afford the pricing we're being charged? Are we all going to be forced to follow Columbus to get network connectivity?" said White.
A domestic 300km 2Mbps leased line costs four times as much in Europe than in the US, and a cross border line costs 16 times as much as a line in the US, according to White.
He suggested that users should use Internet based bandwidth brokers to buy telecom services at a rate decided by the user. He compared this model to the online auction model.
"The telecom manager of the year 2000 should look at how they could use ecommerce to shift the power to the buyer," said White, adding: "Maybe you should deal in bandwidth, or have brokers. Whatever, you need real choice so you can make competition a reality," he said.
Vivienne Peters, director of regulatory affairs at American Express Europe, speaking after White, said Amex had "had to go west" to the US to get good value communications services. Amex spends $1 billion a year on network and telecoms services.
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