The Spanish regulatory authority, the Comisión del Mercado de las Telecomunicaciones, has today published a resolution (approved by its board on 26 Feb 2004) concerning the conditions under which a public authority (Generalidad de Cataluña) is entitled to finance the rollout of broadband Internet access in specific locations.

This resolution is clearly of wider relevance, in Spain and elsewhere in Europe.

In mid-2003, the Generalidad de Cataluña had presented (to the CMT) a draft agreement (Convenio) with Telefónica, by means of which the public authority proposed to subsidise the equipment of specific Telefónica local exchanges with DSLAMs to enable the provision of xDSL services, in order to extend the rollout of broadband Internet services to certain locations.

The CMT has now ruled that the predetermined choice, by the public authority, of ADSL technology, and the choice of a direct subsidy to Telefónica, cannot be accepted, unless further extensive justification is provided by the public authority, specifically as regards the grounds on which there would be a deviation from the principle of technological neutrality.

The CMT's resolution emphasises that such a predetermined choice could distort competition, and that there are other operators (for instance those using leased lines or local loop unbundling) and other technologies (for instance cable modems, fixed wireless access, powerline communications, and WiFi) which must also be taken into consideration, and should equally be eligible for public financing in the context of broadband rollout.

The full text of the CMT resolution (in Spanish) can be accessed by clicking here.