Need help? Keep waiting …

Posted on April 30, 2008 | Filed Under communication technologies

It is something less than a success story: the “harmonised numbers for harmonised services”, a pet issue of Commissioner Reding (”the patroness of heavenly harmony”, as Shakespeare might have called her for that [The Taming of the Shrew, Act III, Scene 1]), are still not operational in any of the 27 member states.

The so called “factsheet” of the DG Information Society on the 116-number range (see already here for the first edition) has now been updated to reflect the results of a survey among member states. And even though that survey (see here for a summary) verifies that there is no single 116-line operational at the moment, the Commission sticks to the purposefully misleading title of the “factsheet”: “Need help? Call a 116 number!”

If there is anything the survey really brings to light, it is mainly a thorough disinterest in these numbers in most of the member states (”We have no further information on this” is a recurring theme, the Estonian NRA even emphasises: “we have had no interest what-so-ever”). Still, the Commission wants to push ahead, and at the same time makes clear on its website clear who will be to blame in case the success remains limited: “more could be done by competent ministries, national regulators, telecoms operators”.

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Private regulation in the telecom industry

Posted on April 29, 2008 | Filed Under communication technologies, events / publications

rscas_conference.jpgLast week the EUI in collaboration with the Florence School of Regulation held a workshop on public and private regulation in the telecom industry. As several issues which might be of interest for the average reader of our blog were touched, I’d like to briefly present the highlights (as pointed out by Fabrizio Cafaggi in his conclusions at the end of the workshop):

The notion private regulation comprises both, the regulatory instruments of self and co-regulation; we should look at these as two different strategies. Private regulation is weak when firms are highly conflicting, which suggests that it works best at a very low level of competition. Private regulation requires a clear bargaining table (as bargaining is the main incentive for firms to engage in this form of regulation). It thus functions better at a national (centralized) level than within a strongly decentralized multilevel system (as the transnational European legal order). Finally, private regulation does not seem to be the best option when it comes to ensure public service objectives in this sector. The undertakings are not going to provide unprofitable services, as there are no market incentives to do so. Today the universal service obligation (constrained to plain old telephony) does not constitute a financial burden for the telecom operators. So it’s not really an issue. But it becomes one, when the question gets to broadband being part of the universal service. This however is not expected to be the case for a long time yet. At least the proposed reforms of the EC electronic communications regulatory framework do not envisage such an extension of the universal service obligation.

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“The validity or otherwise of the Roaming Regulation” before the ECJ

Posted on April 28, 2008 | Filed Under communication technologies

“The underlying question therefore is the validity or otherwise of the Roaming Regulation” - in the Case [2007] EWHC 3018 (Admin), the High Court of Justice (England & Wales), Queen’s Bench Division (Administrative Court), decided to request a preliminary ruling from the European Court of Justice concerning the Roaming Regulation, and in particular the retail price regulation (Case C-58/08 Vodafone and Others). The question for the ECJ is:

“Is Article 4 of Regulation (EC) No. 717/2007 (together with Articles 2(a) and 6(3) insofar as they refer to the Eurotariff and obligations relating to the Eurotariff) invalid on the grounds that the imposition of a price ceiling in respect of retail roaming charges infringes the principle of proportionality and/or subsidiarity?”

In case you want to keep track of the telecommunication and broadcasting cases pending at the ECJ, you can have a look at the updated list here.

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“the fashion of the world is to avoid cost”*: ECJ on cost-orientation

Posted on April 24, 2008 | Filed Under communication technologies

Today, the European Court of Justice delivered its judgment in the case C-55/06 Arcor, concerning the issue of cost-orientation according to Regulation (EC) No 2887/2000 on unbundled access to the local loop. This regulation is part of the old framework and, while not yet formally repealed, is not applicable any more due to Article 27 of the Framework Directive. Still, some of the answers of the ECJ may be of relevance also in the current framework, in cases where cost orientation is imposed as a specific obligation (remedy).

For national regulatory authorities (NRAs) looking for guidance, this is as good as it gets:

“Thus, pursuant to the provisions of Directive 97/33, which also apply to the local loop under Regulation No 2887/2000, the method of cost calculation may be based both on costs already paid by the notified operator – which presupposes the taking into account, as the basis of reference, of costs at their historic value – and on forward-looking costs – which does not exclude the taking into account, as the basis of reference, of costs at their current value.
It is under those conditions that the NRAs have to calculate the actual costs which have to be taken into account for the application of the principle that rates for unbundled access to the local loop are to be set on the basis of cost-orientation.”

Not historic costs, not current costs, but actual costs, taking account of both? I would not really call this an exact formula for calculation. But NRAs, at least under the old regulation, also have some wide-ranging liberties: “Community law leaves to the NRAs … the choice of cost‑accounting method which they deem most appropriate in a specific case.” And they can apply their beloved analytical models:

“[W]hen NRAs are applying the principle that rates for unbundled access to the local loop are to be set on the basis of cost‑orientation, Community law does not preclude them, in the absence of complete and comprehensible accounting documents, from determining the costs on the basis of an analytical bottom-up or top-down cost model.”

 *) Shakespeare, Much Ado About Nothing, Act I, Scene 1

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“My thoughts aim at a further matter”*: i2010 mid-term review

Posted on April 20, 2008 | Filed Under communication technologies

“Now is the time to think beyond 2010″, the Commission announced in presenting the mid-term review of the i2010 policy framework, and promised (or threatened?) “a long-term agenda for information society and media policies”.

So, one agenda at a time, the Commission also promises some actions for 2008, such as:

  • a “Communication on the future of networks and Internet” (which, in the Commission’s words, should “help prepare the information society for the future” - doesn’t anyone proof-read such communications to make sure they make sense?);
  • a recommendation on Next Generation Access;
  • a recommendation on RFID, “focusing on privacy and security issues”, but with the aim to “promote the Internet of Things” (reading about the “internet of things”, by the way, always reminds me of Arundhati Roy’s “The God of Small Things”, which is of course not a report on RFID);
  • the report on universal service (it’s not really a favorite item of Commission policy, and the Commission makes clear that the report will be issued “in line with its obligations”, which seems to imply: not of the Commission’s own will);
  • a “guide that explains users’ rights and obligations in the digital environment”;
  • and - interesting to read in the i2010-communication: the launch of “the next phase in the review of the consumer acquis — Framework Directive on Consumer Contractual Rights”;
  • aside from that, it’s facilitating, promoting (or rather: further promoting, where promoting has not been successful so far, such as for the “eSignature”), and monitoring as usual (the Commission even states explicitely that “high quality monitoring is crucial”)

The Commission also promises - much to our surprise ;-) - to support the adoption of the regulatory package for e-Communications and “in particular the creation of the EECMA”, and to make spectrum management more efficient “by facilitating the harmonisation and trading of the pan-European part of frequencies” (!). And of course, there are some invitations, such as for the Member States “to set national targets for high-speed Internet usage to reach a 30% penetration rate among the EU population by 2010″.

>Which reminds me of the Presidency Conclusions of the Brussels European Council (13/14 March 2008). The availability of high-speed internet also had been on the agenda, and in spite of more wide-ranging proposals (even in the Key Issues Paper (KIP) 2008), all the European Council could agree on was that

“high-speed internet usage must be significantly increased. Member States should aim to make high-speed internet available to all schools by 2010 and to set ambitious national targets for household access as part of their National Reform Programmes” (emphasis added)

Aiming to set ambitious targets to me does not sound like a full commitment (but then, in the words of Shakespeare, “the very substance of the ambitious is merely the shadow of a dream”, Hamlet, Prince of Denmark, Act II, Scene 2).

Here’s the full set of links: i201o mid-term review 2008 website, Commission Communication on the Mid-term review, Staff Working Document Volume 1, Staff Working Document Volume 2, Staff Working Document Volume 3 (Country Profiles), Press release

*) Shakespeare, King Henry VI, Part 3, Act IV Scene 1

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Magenta squeeze: CFI upholds Commission decision against Deutsche Telekom

Posted on April 10, 2008 | Filed Under communication technologies

No, of course it should read margin squeeze, not magenta squeeze, but maybe Deutsche Telekom should also trademark the term “magenta squeeze”, as it could refer to a practice of Deutsche Telekom that earned it a fine of 12.6 million Euro for abusing its dominant position in local access. Today, the Commission decision of 21 May 2003 (!) was fully upheld by the Court of First Instance (see here for the press release, and here for the decision).

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“Ay, but the case is alter’d”*: infringement cases closed

Posted on April 10, 2008 | Filed Under communication technologies

In a press release, the Commission announced on 3 April 2008 that it has sent two new reasoned opinions to Bulgaria and Romania (concerning the emergency number 112 which according to the Commission is not available nationwide in Bulgaria and not for mobile calls in Romania). In the last paragraph of the press release, the Commission also gives notice that it has closed two infringement cases against Finland “following amendments to the Finnish Communications Market Act that entered into force on 1 January 2008″.  What the press release did not state was that in one of these cases the Commission had lost at the Court of Justice (see this former post) - which, I presume, certainly did alter the case …

A list of all infringement proceedings concerning the regulatory framework for electronic communications networks and services is available on DG Info’s website.

* Shakespeare, King Henry VI, Part 3, Act IV, Scene 3

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Talking on air - rules on in-flight mobile phone use

Posted on April 8, 2008 | Filed Under communication technologies, spectrum policy

uber_den_wolken.jpgYesterday the European Commission introduced rules to harmonise the technical and licensing requirements for the use of mobile phones on board aircrafts (click here for the press release). The idea is to allow passengers to “receive and make calls and messages safely with their own mobile phones while flying all over Europe“. Technically the passengers’ mobile phones will be operated by an onboard cellular network connected to the ground via satellite (The system is already under commercial trial by Air France-KLM). At the same time the phones will be kept from connecting directly to mobile networks on the ground below. That way the airlines will be able to provide truly Europe-wide telecoms services with only one Member State’s licence, namely the one they are registered in.

While the European Commission says it is responding to demand from air passengers to use their mobile phones during flights, some airlines like for e.g. British Airways, Austrian Airlines and Lufthansa, however, have already announced not to offer such services. Interestingly enough they argue that their decision was taken in consideration of their customers demand for ease and comfort. Regardless of the question, if a certain timespan “offline” is more of the enjoyable or the annoying kind, the success of in-flight mobile phone use will largely depend on the costs. These could be considerably higher than their “grounded” counterparts (i.e. they are not covered by the roaming regulation). Commissioner Reding comes to the same conclusion when, as stated in the press release, saying that:

“… if consumers receive shock phone bills, the service will not take-off.”

update 10 April 2008: The Commission Decision is published in today’s Official Journal.

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Time brings everything out into the sunlight: advocate general Colomer on Access Deficit Contribution

Posted on April 1, 2008 | Filed Under communication technologies

Advocate general Colomer, well known for his references to fine literature, has already likened his job to that of a painter (see here); in today’s opinion in the Case C-152/07 - C-154/07 Arcor (not yet available in English) he adds a further touch of fine arts as he goes for the opera: “Los esclavos felices” (”The Happy Slaves”), the title of an opera by Juan Crisóstomo de Arriaga, is mentioned in Footnote 9. But to the Spanish advocate general, Cervantes is never far off, and in Footnote 28 you can find the quote mentioned in the title of this post: “que el tiempo, descubridor de todas las cosas no se deja ninguna que no la saque a la luz del sol” 

And in fact, sometimes even in telecommunications it takes some time to solve a problem. The case in question deals with the rebalancing of telephone tariffs as a result of abolishing the national monopolies on voice telephony (more than ten years ago). Traditionally, most monopoly operators offered access to fixed line voice telephony at a rate below costs, while the per-minute charges for the calls made were more expensive and thus subsidized the access. Also, low tariffs for local calls were subsidized by more expensive national and international calls. Both imbalances were primarily motivated by concerns rooted in social policy: access to the telephone and to local calls should also be available to people with lower income, while national and international calls were traditionally more important for business and better-off consumers, who thus subsidized the less well-off. When the market was opened, tariffs had to be rebalanced. The deadline for rebalancing - to prevent unfair cross-subsidies which would have a negative influence on competition - was 1 January 1998.

The German regulator had mercy with poor Deutsche Telekom and asked competitors to contribute to the access deficit by means of a surcharge to the interconnection fees, for a period of not even three months in the year 2003. Advocate general Colomer is scathing in his criticism of Deutsche Telekom (and implicitely the German regulator): he points out that Deutsche Telekom is favoured by protectionism that runs contrary to Art 82 of the Treaty and “seems to be endogamous”, as Germany still holds (at least) 31.7% of the shares (Nr. 55). Also Deutsche Telekom is likened to Molière’s imaginary invalid, as it complains about an “anachronistic deficit” which is solely its own responsibilty (Nr. 65).

So the advocate general comes to the conclusion that the surcharge on interconnection fees levied on operators to make a contribution to alleviate the “access deficit” of the incumbent is incompatible with Article 4c of the Competition Directive 90/388/EEC and Article 12 (7) of the Interconnection Directive 97/33/EC. (No need to say that it would not be compatible with the current framework as well). And there is no reason for the national court to hesitate in directly applying these directives.

Next stop for Deutsche Telekom in Luxembourg: 10. April 2008, when the Court of First Instance will issue its judgment in the competition case T-271/03 (”pending at the Court  of First Instance for more than four years”, as advocate general Colomer points out in Footnote 24 of his opinion in the Case C-152/07 - C-154/07 Arcor )

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