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* Package to include roaming, consumer protection measures
* Official says majority of commissioners voted for it
* Blueprint comes as sector in Europe faces falling revenues
By Foo Yun Chee and Claire Davenport
BRUSSELS, Sept 10 (Reuters) - The European Union Commissionhas approved a plan to spur investment in communicationsnetworks and create a single market for telecoms servicesdespite concerns that some parts may favour big operators, twoofficials said on Tuesday.
The commission's telecoms chief Neelie Kroes will onThursday present the reforms, which are part of an effort tohelp Europe catch up with Asia and North America in mobile andfast-speed network infrastructure.
As expected, it will include measures aimed at phasing outroaming charges, improving consumer protections in telecomcontracts, and making mobile spectrum auctions more consistentin the region, among other elements, according to a draft seenby Reuters.
But the package will likely evolve - and be subject tointense lobbying - as it winds it way through the legislativeprocess. The region's 28 countries and European Parliament mustsign off before it becomes law.
"The text as proposed will go through now. The majority ofcommissioners voted for it," said one of the EU officials whodeclined to be identified because of the sensitivity of thematter.
On roaming, Kroes chose an approach seeking to encourageoperators to form alliances amongst themselves so consumers donot have to pay more when calling abroad. If operators do so,they would not be subject to wholesale caps on roaming fees,although it remains to see whether they play ball.
To make it easier for smaller operators to join roamingalliances, the latest draft softened the requirement that suchaccords cover at least 85 percent of EU population.
SECTOR STRUGGLES
Kroes also beat back a late challenge to the so-called "netneutrality" provisions in the package, which allow telecomoperators to charge Internet companies for prioritising trafficon networks.
France's Orange has such a pact with Google, and other telecom operators believe such accords couldbe a viable new business for them. But their legality is muddyin Europe with some states such as the Netherlands outlawing thearrangements to keep the Internet as a fair playing field.Internet activists also oppose such arrangements.
Telecom operators hope that Kroes' net neutrality measureswould clear up the legal uncertainty and head off othercountries from passing laws such as the Dutch one.
Kroes' blueprint for the telecom sector comes as theindustry in Europe struggles with falling revenues, stringentregulation and fierce competition in many markets.
Europe's telecoms industry will face a 0.5 to 2 percentannual drop in revenues by the end of 2020, according to areport by Boston Consulting Group for telecoms lobby group ETNO,leaving a huge investment gap of 110 billion to 170 billioneuros.
Stephen Howard, a telecoms analyst at HBSC, said Kroes'reforms would go some way to spurring operators to invest morein their networks. "I do think, when taken along with earlierpolicy on how next generation broadband networks will beregulated, that the package has moved the needle," he said.
"Admittedly we need to see the details of proposals and howthey are implemented but for instance, the changes on howspectrum is allocated could have tremendously positive impactfor operators."
Telecoms bosses initially welcomed the EU effort to boostnetwork investments but some have since soured on some of itsharsher elements, such as the roaming moves.
They are also frustrated at the exclusion of their keydesire, namely a softer approach to consolidation amongoperators. Merger policy is set by EU antitrust watchdog JoaquinAlmunia, and Kroes' has little power to influence it.
Several telecom deals are now under review by Europeanauthorities, including one seen as potentially important testcase that would allow Telefonica to buy a rival inGermany and take Europe's largest market down to three players.
