Telecoms and artificial intelligence (AI) leaders argue consolidation is the best way to keep Europe’s industry competitive.
Telecommunications leaders attending Mobile World Congress in Barcelona this week have once again called for consolidating the industry to keep it competitive in Europe.
Marc Murtra, the CEO and chairman of Spain’s Telefónica, called in an early keynote of the conference for large telecommunications companies “to be allowed to consolidate and grow to create technological capacity”.
Murtra added that if European authorities don’t allow that, “Europe’s position in the world will continue to dwindle and will not have the capacity to decide our future autonomously”.
It’s the same message the telecom bosses had at MWC last year, according toBloomberg, but this year’s call comes as Europe considers how to compete with China and address its dependency on US technologies.
Europe as a ‘tech taker, not a tech maker’
The 2024 Mario Draghireport on European competitiveness says the European Union has “dozens” of telecom players serving roughly 450 million people, compared to just “a handful” in the United States and China.
Margherita Della Valle, CEO of Vodafone, said on an MWCpanel that Europe is “becoming a tech taker and not a tech maker” and risks having to ask hyperscaler companies to take a burden of the telecommunications traffic in the future if this continues.
But Della Valle and Murcia believe that won’t happen if the EU creates the right market for investment in telecommunications innovation.
“I think it needs to become a top priority in Europe to find more opportunities to create scale,” Della Valle said.
‘What we need is DOGE’
Another CEO took inspiration from a new government cost-cutting initiative in the United States to consolidate the telecommunications industry.
“What Europe needs is a [Department of Government Efficiency] DOGE,” Peter Höttges, the CEO of Germany’s Deutsche Telekom, told theaudience.
“We need an initiative to cut down this bureaucracy and this administration here, because there are tens of thousands of people sitting there and administrating our industries,” he added.
DOGE, co-run by tech billionaire Elon Musk, has also come under fire for making huge job cuts across different US agencies.
Euronews Next reached out to the European Commission for a response to the comments made by telecom CEOs at MWC but did not receive an immediate reply.
On merger policy in Europe overall, the Commission states that “while some mergers can bring benefits to the economy, some combinations reduce competition and risk harming customers”.
The Commission also wants to update telecom regulations with the Digital Networks Act, which Euronews previously reported isplanned for early 2025.
Consolidation helps with AI integration, Mistral boss says
Arthur Mensch, CEO of France’s Mistral AI, said in a question-and-answer session at MWC that market fragmentation is still one of Europe’s biggest challenges, both in the AI and telecommunications sectors.
Having multiple telecommunications operators makes large-scale deployments more complex, Mensch added, so consolidation of larger tech players “could be an asset”.
The AI company recently announced a deal with French telecoms company Orangeto integrate Mistral’s Le Chat into some mobile subscriptions to create “AI-driven personalised services”.
Orange also got access to Codestral, Mistral’s large language model (LLM) for business customers.
