Reding Seeks End to ‘National Mindset’ Toward Telecom Regulation
BRUSSELS -- Europe must “break away from a purely national mindset” to resolve competition problems in the e- communications sector, Information Society and Media Commissioner Viviane Reding said Wednesday. She defended her decision to create a new body to advise the European Commission (EC) on regulatory matters, saying it will pursue a European approach based on a continent-wide vision. The proposal for the European Telecom Market Authority (ETMA) departs from the concept of a consensus-based approach and instead will be an open and accountable body within the European Community framework, Reding told the European Competitive Telecommunications Association (ECTA) conference.
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The EU telecommunications sector is successful but faces three major problems, Reding said: The pan-European market for corporate services is totally underdeveloped due to fragmented competition rules; mobile termination rates differ substantially from country to country -- from 2.5 eurocents in Cyprus to 16.5 eurocents in Poland -- and VoIP services are regulated so differently in the 27 member countries that there’s little opportunity for new entrants. It’s ridiculous to think those problems will disappear on their own, she said -- hence, the need for ETMA, the “key that unlocks the door” to a single EU market.
The incoming Slovenian Presidency believes that the way to a single market is by regulating international traffic and telephony markets that are outside the reach of national authorities, said Matjaz Jansa, director general of that country’s Ministry of the Economy Electronic Communications Directorate. He suggested that power be given to a central body to handle such activities.
Reding gained strong support from ECTA’s latest regulatory scorecard. It compared the telecommunications regulatory environment in 19 countries, finding lower prices and higher investment in those with strong regulators. The independence and powers of some national regulatory authorities have been restricted, compromising their ability to enforce rules, ECTA said. State ownership in telecommunications companies appears to exert substantial influence on the overall effectiveness of a country’s regulation, the organization said.
The scorecard also found that some regulators aren’t moving fast enough to understand and address new issues such as replacing copper with fiber or traditional networks with VoIP, ECTA said. Lengthy appeals against regulatory decisions, lack of transparency by incumbents over their next-generation upgrade plans, and effective local loop unbundling are among several other problems ECTA cited.
The legislative package also calls for spectrum reform. Europe has outgrown the traditional command-and-control scheme, Reding said. Users are better able than regulators to find the best use of spectrum, she said, but technological neutrality doesn’t mean anarchy as long as minimal rules are in place. Service neutrality is more important because assigning specific services to specified bands stifles innovation and media plurality, Reding said. Although service and technological neutrality will release enormous benefits, they're not enough because spectrum bands are full, which is why the proposed rules include the option for trading, she said.
One priority of the Slovenian Presidency is to find compromise on spectrum issues, Jansa said. The goal for spectrum, particularly in the UHF range, should be harmonization, he said. That will be difficult because the UHF space is nearly full, and even after digital switchover much of the band will be used for digital TV and other services, he said. Jansa urged the EC to help plan and coordinate efforts to obtain agreement from member states.
Telecommunications ministers will hold their first debate on the regulatory package at Thursday’s Council meeting. Several recommendations are expected to stir debate, including the new regulatory body and the EC plan to allow regulators to order functional separation of dominant players, EurActiv reported.
The EC proposals fail to address the main e- communications market challenges, the European Telecommunications Network Operators’ Association (ETNO) said Wednesday. Incumbents urged ministers to focus on “how to adapt the regulatory approach to reflect the technical specificities and high risks associated with investment” in next-generation networks. Extending rules defined for legacy infrastructure to new high-speed broadband networks sends the wrong signal to investors, ETNO said.
ETNO recommended the EC drop its plan for mandatory functional separation and “too intense” access regulation. It wants geographical segmentation of markets to adapt rules to local competition realities, symmetric facility-sharing obligations for all ducts capable of carrying e- communications services, and the introduction of a sunset clause for price and access regulation. The ECTA conference runs through Friday.