Professor Hazlett on Overregulation of German Cable Industry

German cable systems have lagged in making the digital upgrades required for high-speed service, and that outcome is directly attributable to overregulation, according to Professor Thomas Hazlett in a Wall Street Journal article written following the recent success of EU telecommunications regulators in imposing stricter mandates on Deutsche Telekom. "If regulators seek to promote effective market rivalry, unleashing cable networks to comete with telephone carriers would be the efficient place to start," says Hazlett.

Germany's Cable Problem, The Wall Street Journal Online, August 30, 2006. By Thomas W. Hazlett.

"Germany is the object of the EU's scorn for falling behind in the broadband race. At one level, this is true: Broadband penetration as of December 2005 was 12.6 per 100 persons in Germany, well below OECD leaders like Korea (25.4) and the Netherlands (25.3), and toward the bottom of Western European countries. But the performance laggard is not DSL, which the EU regulators now seek to attack with more stringent mandates, but cable-modem service. The leading broadband markets feature important cable versus telephone rivalries in data service. Yet Germany -- despite having been wired nationwide for cable television years ago -- has just 0.3 cable modem subscribers per 100 population, by far the lowest total for any country with nationwide cable infrastructure."