While reforms to open Europe's telecom market have cut prices and offered customers new services, some former state monopolies retain too strong a grip, the European Commission, quoted by an Associated Press report, said.
"Some markets are not open enough to competition," the report quoted EU Information Society and Media Commissioner Viviane Reding as saying.
The report said that according to the Commission, some incumbent companies retained too much control over fixed-line and mobile markets, and that there was a particular need to cut the cost of using mobile phones abroad.
The report also said the Commission had expressed concerns about Deutsche Telekom's proposed 3-billion-euro ($3.56 billion) high-speed network, which it wanted to be opened to competing operators.
Earlier reports said the German government had originally agreed with Deutsche Telekom's argument that it could only make a decent profit on the network if it was exempt from any requirement to offer its lines to rivals.
But the Commission called the arrangement unfair, the report said.