New proposals for regulation and innovation and investment policy

In his book ‘The Virtuous Circle’ Georg Serentschy presents proposals for industrial policy aimed at putting Europe back on top

Press release dated 31 October 2013

During yesterday’s panel discussion attended by prominent guests, Georg Serentschy, CEO of RTR’s Tele-
communications and Postal Services Division, presented his book entitled ‘The Virtuous Circle’. A great number of visitors, including representatives of business, interest groups, research and specialised media, participated in the lively discussion that took place in the Kleiner Festsaal of the Federation of Austrian Industries (IV).

The book, appearing in RTR’s publication series, proposes reforms for three of Europe’s policy areas – specifically regulation, innovation and investment – as a means of providing new stimulus to the European ICT sector. These three areas would thus set in motion a positive feedback cycle or ‘virtuous circle’.

Goal: to trigger a ‘virtuous circle’ to advance Europe

In Serentschy’s view, telecoms regulation creates the basis for a more attractive environment for innovation and investment. An appropriate innovation policy guarantees that new, innovative services can arise in the first place. In the end, investment policy ensures that the necessary infrastructure is also installed right through to end users – allowing them to utilise the services. “Interplay of all three areas is the prerequisite for setting the ‘virtuous circle’ in motion and maintaining its viability. The goal is for Europe to ultimately become the global leader in the ICT world,” Serentschy stated at the presentation.

The ‘virtuous circle’ is nourished by: more flexible regulation, fewer hurdles for innovations and incentives for infrastructure investors

On the one hand, future regulation should increasingly support the demand side. Transparent rules governing net neutrality would, for example, ensure the innovative character of the internet; corresponding tools such as net tests will enhance the general information level among end users. On the supply side, regulation should set its sights more on the long term and promote dynamic efficiency as well as competition between various infrastructures.

Instead of preserving obsolete business models, policymakers should promote new, innovative services; for instance by allowing quicker business foundations and through targeted funding for start-ups.

Policymakers should encourage suitable pension funds to invest in telecoms infrastructure. Investments generally need to become more efficient, i.e. by coordinating excavation work with other sectors. Here, Europe could also create an appropriate financing framework; for instance in the form of its own infrastructure fund.

The book and the presentation can be viewed by following this link: