In a recommendation to the 15 EU member states, the commission called for telecommunications operators to provide full, unbundled access to copper local loops by 31 December.

Erkki Liikanen: Europe is catching up with the US

Though such a recommendation is not binding, EU Enterprise and Information Society Commissioner Erkki Liikanen said it would be a core part of a package of directives that the commission aimed to release by the end of June.

"I'm sure you will see more competition," said Mr Liikanen, who portrayed the recommendation as a key follow-up to an EU summit in Lisbon last month that set a target of 2010 for Europe to become the world's most wired region.

"During the next six months, the market situation will be very different," he said.

Earlier this month Mr Liikanen told BBC News Online that he wanted to dramatically cut the cost to consumers of connecting to the internet.

He predicted that the free access wars breaking out in the UK would soon spread to the rest of Europe as more and more people tried to go online.

And he argued that only those companies with truly local content would be able to succeed in the ISP wars.

Catching up with US

Mr Liikanen said that Europe was rapidly catching up with the United States in the development of both business-to-business and business-to-consumer internet services.

He said that Europe would move this year to finalise the development of an e-commerce framework, with consumer rights, data protection and laws that allowed electronic signatures.

Mr Liikanen admitted that in the consumer internet field, Europe would continue to lag behind the US for a number of years.

The unified market, the dollar, and the quick postal delivery system had given the US an advantage.

But he saw consumers rapidly moving to certain key services, such as travel and tourism, financial services, and software and music, which would develop more quickly when broadband became available.

'Start making savings'

He said it was vital for all European companies to start embracing the savings possible through the internet.

It was estimated that the US economy had added 0.25% per year to its growth rate through the use of the internet, and Europe could do the same.

Mr Liikanen told the BBC that the main problems for Europe in developing the internet were the high cost of access, the lack of computer literacy, and the weak legal framework.