Deutsche Telekom must answer to Brussels

European regulators have accused Germany's largest telco of abusing its market position and so hurting competition.

The EC carried out a three-year investigation that found 98 per cent of consumers still use Deutsche Telekom services. The German market is often held up as an example of effective ADSL roll out - branded T-DSL there - yet this has come at the expense of any significant competition from cable modem services or other operators allowed to use Telekom facilities.

The main thrust of the EC probe, headed by Competition Commissioner Mario Monti, is that there has been no practical local loop unbundling.

Telekom has said it is surprised by the EC's findings. If the company fails to justify itself over the next two months it could face a fine of up to a tenth of its annual turnover, though such a large punishment is thought unlikely.