European Regulators to Tackle VoIP, Wholesale Roaming in 2005

This year, the ERG and the European Commission (EC) issued their common position on remedies. The remedies paper was meant to assist and “inspire” national regulatory authorities (NRAs) to treat similar telecom markets the same way while allowing remedies to be tailored to each country’s circumstances, Andersen said. Setting remedies in cases where operators hold significant market power is “the main challenge for all NRAs,” he said. The ERG intends to update the remedies document to take into consideration practical experience gained during NRA market reviews, he said. Andersen wouldn’t elaborate on what parts of the document are likely to undergo revision since it hasn’t yet been finished.

VoIP rollout requires a coordinated regulatory approach, and the ERG is looking to craft a common position, Andersen said. The group’s VoIP work is expected to cover short and long-term issues, he said. Short term issues could include finding a regulatory approach to urgent questions such as access to emergency calls and number portability, he said. Longer term items might be examining VoIP’s impact on competition and VoIP interconnections, that is, IP to IP (Internet Protocol) and IP to public switched phone networks.

The ERG has begun an analysis of Europe’s wholesale broadband market. The results will be used in revising the remedies document, Andersen said. The group’s work in 2005 will include access and penetration issues as well as infrastructure development, he said.

There appears to be a strong “wish” by politicians, especially those in the European Parliament, for the ERG to deal with WIR issues, Andersen said. In 2005, the group will aim for a common position, to minimize excessive charges, he said.

In addition to tackling major regulatory issues, the ERG will provide input to the EC on various proposed revisions to several directives, Andersen said. These include changes to the recommendation on relevant products and services markets, a consultation on the scope of the universal services directive, and a legislative and economic analysis of the access directive, he said.

This week’s EC report on carrying out the new regulatory framework cited persistent regulatory issues. Speakers at a morning panel session urged the ERG to tackle several issues in its revised remedies paper. One suggested the ERG address: (1) A standardized approach to price squeezes between wholesale and retail prices. (2) Preventing incumbents from leveraging market power through cross-selling when they enter new markets. (3) Coping with the noncoordinated effects of market behavior in broadband markets in which several players have significant power. Another panelist said “quality squeeze” -- as when customers of competitive operators must wait 40 hours for repairs by an incumbent -- is as important a consideration for regulators as price squeeze. Another participant complained that ERG is neglecting concerns of directory inquiry services about incumbents selling subscription data at excessive prices.

The draft ERG work program is due out shortly, Andersen said. He asked those who would like the group to take up other issues to make their cases during a mid- Dec.-Jan. public consultation. However, he made clear that the ERG’s resources are limited, so the group must focus on the most important issues. A public hearing is set Jan. 14. Final adoption of the work plan is slated for the ERG plenary meeting Feb. 10-11.