EC Proposal for New Telecom Agency Rejected by U.K. Government

The EC, which is preparing to publish recommendations for changes in the EU e-communications regulatory framework, is considering a European Electronic Communications Market Authority, consisting of heads of national regulatory bodies, to advise the commission on a few matter, Cave said. Information Society and Media Commissioner Viviane Reding appears to be pursuing the Victorian “housemaid’s baby strategy” -- the baby isn’t a problem because it’s small, he said. Reding says not to worry about the new agency, Cave said, but what happens when it turns 18?

Another divisive idea under discussion is that national regulators be allowed to order dominant players to split their networks from their services arms. Functional separation of British Telecom is working very well and is a good model for other EU countries with similar bottleneck problems, Timms said. But functional separation on its own won’t transform Europe’s telecommunications markets, he said. He urged the EC to increase the power of national regulators and make them completely independent; encourage more liberalized, market-driven spectrum management; and streamline and reduce the number of markets that regulators must analyze for potential preemptive competition regulation.

Cave characterized the EC proposals as generally small and incremental. A dominant theme is liberalization of spectrum markets, which some EU states support and others are “queasy” about, he said. The EC also believes it should have the power to veto competition conditions set by national regulators, a proposition that’s causing a turf war, Cave said. The EC is expected to unveil its recommendations Nov. 13.

The U.K. Office of Communications (Ofcom) is focused on a need for continued effective regulation of enduring bottlenecks in the legacy network, said agency Senior Partner Ian Hargreaves. But Ofcom is seeking ways to cut wholesale regulation, he said. It’s also considering how to ensure investment in next-generation access networks, and it will consult with interested parties about available options. Unlike Germany, he said, the U.K. doesn’t favor granting regulatory “holidays” to operators building next-generation networks.

Ofcom also rejects calls for net neutrality, Hargreaves said. Some discrimination, such as traffic prioritization, may reduce costs to consumers, he said.

Ofcom is releasing a great deal of spectrum to allow the market to make better use of it, Hargreaves said. The debate about what to do with spectrum freed by digital switchover centers on whether the bands should be set aside solely for broadcasters, he said. Ofcom is working with the broadcast industry to make the most of the current spectrum for new applications such as HDTV, he said.

Future-Proof Regulation Needed?

Future-proof regulation is a “worrying phrase” that could make regulators feel their job is to craft rules immune to disruption or the effect of innovation, said Hargreaves. The question should be “how much risk should a good regulator take?” he said. At the “jagged edge” of change, regulators should take well considered risks and be judged on their outcomes, Hargreaves said.

In regulating convergence, the government’s role should be “gap-filling,” said Robert Pepper, Cisco senior managing director for global advanced technology policy. Instead of automatically regulating, it should rely on market forces as much as possible, stepping in only where the market doesn’t work, he said.

Governments should ensure inclusion of all citizens, reduce income barriers to the adoption and use of information and communication technologies, ensure coverage of unserved and underserved areas, protect consumers and enforce existing rules, Pepper said. Government and business both have roles, he said.