RD 248 - ETNO Reflection Document on the Commission Communication on a Review of the EU Regulatory Framework for electronic communications networks and services
The Reflection Document gives a detailed overview of ETNO positions on the following aspects of the 2006 E-communications regulatory Review:
The Reflection Document gives a detailed overview of ETNO positions on the following aspects of the 2006 E-communications regulatory Review:
- The technology and market context
- Regulatory approach, investment and innovation
- Structural and functional separation
- Approach to spectrum
- Streamlining market reviews
- Consolidating the internal market
- Consumer protection and user’s rights
- Security issues
The technology and market context
- The current proposals for the review of the regulatory framework will be in force in the years 2010/11 – 2015/16.
- The e-communications sector is faced with unprecedented challenges, requiring firms to rapidly innovate and adapt. In the relevant timeframe, the focus will shift from traditional telecoms regulation such as access to (incumbents’) networks to competition issues familiar in other innovative sectors.
- By 2012, the transition to all IP-networks will be largely concluded - the ‘legacy’ telephone network will no longer exist in many places. Multi-play services, competition by internet and media companies on IP-based applications, full con-vergence of networks and services, wide availability of wireless LAN and high bandwidth 3G services will, amongst others, fundamentally alter competition.
Regulatory approach, investment and innovation
- The application of the NRF is delaying large-scale private investment in ad-vanced broadband networks and services needed in Europe, depriving EU citizens of the potential benefits of innovative broadband services.
- The Commission’s claim that the current framework is favourable to invest-ments is not backed by convincing evidence. The regulatory indices used by the Commission to demonstrate a positive relation between investment and regu-lation are not suited for measuring the effects of the NRF.
- The NRF has failed to achieve a gradual transition to competition law that was envisaged by the Commission in 2001. Instead, the NRF covers almost all new market areas and has reinforced dependence on regulatory intervention.
- ETNO calls for a thorough change in the regulatory approach in line with a chang-ing sector. The review should provide a credible exit-scenario from ex-ante regulation to ensure the transition to harmonised competition rules, in order to align the electronic communications regulatory regime to that of all other innovative sectors of the economy.
Structural and functional separation
- Any forced - as opposed to a voluntary, market-driven - separation of networks and services in the form of functional or structural separation risks discour-aging investment in the e-communications sector. ETNO supports the findings of the Commission’ impact assessment in this respect.
- Giving NRAs the tool of functional or structural separation risks to damag-ing harmonisation and innovation in the single market. Separation imposed by regulators ‘freezes’ a snapshot of competition and technological development on individual markets and can lead to permanently diverging outcomes across the EU.
- Discussing new and potentially disruptive remedies is counterproductive in an increasingly competitive and multi-platform environment which requires de-regulation. Mandated functional or structural separation would put Europe’s main investing companies at a massive competitive disadvantage.
Approach to spectrum
- The regulatory framework for radio spectrum should inter alia:
o be stable enough to allow operators to develop their strategies and fa-cilitate return on investment and avoid harmful interference, cross border problems and loss of quality of service
o provide the right balance between harmonization and flexibility in the use of the spectrum, allowing the development of innovative interoperable technologies and services and fostering investments. - Harmonising frequencies facilitates the best use of this scarce resource and is a sound basis for the implementation of a European market.
- The opportunities (e.g. quicker access to spectrum) and drawbacks (potential risk of interference, reduced interoperability, ..) of technology neutrality should be carefully evaluated before this approach is introduced.
- ETNO supports the coordinated approach as proposed by the Commission re-garding spectrum trading.
Streamlining market reviews
- Quality requirements for market analyses should be maintained. ETNO does not support a simplified procedure when remedies remain unchanged. It could lead to a further decrease in quality and scrutiny of regulatory decisions.
- National markets which were found to be effectively competitive in a previous analysis should no longer be analysed in an ex-ante context. This would signifi-cantly reduce the bureaucratic burden for market participants and regulators.
- ETNO sees no need for introducing a regulation on procedural issues in view of better regulation principles and the transitional character of Art.-7 procedures.
‘Consolidating the internal market’
- The review should
o keep ensuring the application of harmonised regulatory objectives and principles,
o introduce accountability for regulatory decisions and positions taken by institutions at EU level, including effective appeals and
o not create a new bureaucratic regulatory structure at EU level that would be difficult to dismantle when ex-ante regulation is phased out. - An effective appeals process is essential for market players. Before amending national appeals by means of EU law, it should be evaluated if problems can be tackled under the current Directives in those Member States where they exist.
- ETNO welcomes the Commission’s proposals regarding the review and justi-fication of must-carry obligations existing at national-level. In addition, the rele-vant article in the Directives should be limited to what is absolutely necessary.
Changes proposed in relation to numbering
The Commission’s proposals related to numbering issues seem to be based on mere assumptions and raise many questions in view of their necessity, feasibility and objective:
- The proposal to include a general provision regarding users’ rights to access non-geographic numbers cannot remove technical or economical limitations.
- An extension of the number portability obligation to include subscriber’s personal directory such as identifiers or Internet names and addresses is out-side the responsibility of NRA’s and the EU, but remains solely under the in-ternationally established procedures of the relevant internet organisations.
Consumer protection and user’s rights
- ETNO supports the Commission’s proposal to have an open debate about the need for a universal service regime in the future.
- Decisions that would pre-empt this debate such as the proposed separation of networks and services for the purpose of universal service should not be in-cluded in the review.
- ETNO supports the Commission’s conclusion that there is no need for specific rules at EU level in view of the ‘net neutrality’ debate.
- To allow NRAs to mandate minimum quality parameters for all services at all times could lead to a significant price increase for the end-user in view of in-creasing IP traffic and could seriously damage the attractiveness of the internet
Security issues
- ETNO Members have a strong own interest to strengthen network security in order to increase user confidence in new e-communications services. ETNO Member companies are continuously working to improve security, considering it a key competitive element of differentiation in the market.
- Therefore, ETNO doubts that the multiple and overly simplistic regulatory measures proposed by the Commission would achieve the ultimate goal of improving security. They could partly even be detrimental to consumer trust and e-confidence.