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Since the liberalization of European telecommunications markets, regulators at European and national level have been relatively successful in forcing down the price of access to the historic monopolists' fixed network. This has led, however, to the development primarily of 'service competition' in most of Europe, while infrastructure competition has been limited. As a consequence, investment levels are significantly lower than in the United States, particularly for the provision of broadband. Mobile telephony has, however, diffused quickly in Europe compared with the United States, partly as a result of the successful second-generation Global System for Mobile Communications (GSM) standard adopted, and partly as a result of the charging systems employed. These developments have, however, been imperilled by the cost and delays associated with third-generation mobile technology. A new regime for regulating communications is currently being developed in Europe. If properly applied, it will reduce regulatory intervention and promote investment and innovation in both fixed and mobile services, but there is a risk that national regulators may thwart this outcome. Copyright 2001, Oxford University Press.