EU matters interview The telecommunications sector is broadly regulated in the EU. At the same time, it is a fast growing sector and adapted regulation is needed. How do we ensure that the new regulation doesn’t harm the growth and competitiveness of this sector? Whichever policy or regulation is put in place, it must be innovation-friendly and growth conducive. The telecommunication sector is highly regulated, much more so than other sectors in the EU and far more than in the rest of the World. Due to rapid innovation, our industry is a moving target for regulators and we need less sector-specific regulation. The Internet value chain has changed compared to ten years ago. Today we need to address two key challenges: platform competition and overthe-top players. As for platform competition, fixed networks compete with mobile and cable networks. In addition to this, the same services operated before only by telecom operators, are now being delivered by over-the-top players providing SMS, voice, video and others (internet services such as Whatsapp, Google or FaceBook). We cannot ignore it. Our companies don’t fear this competition, but to compete we must have a fair basis – an equal footing – for all players currently in the market. The problem is that we have a range of services that are regulated when provided by telecom operators, but unregulated among over-the-top players. This creates a threat to consumers, who have different sets of rights. Therefore, we wish to have deregulation in our area of fixed access and level the playing field for competing with over-the-top players. The telecoms sector still bears the legacy of former national monopolies, no large telecommunications companies operate in all Member States. What are the primary barriers to Single Market in this area? We are a strong advocate for Single Market. Building scale is the next step for telecom operators to drive growth and fight for innovation and success in a global ICT market. Another important aspect is spectrum. We are supporters of the European Commission proposal in this area, as spectrum is the life blood of the telecom sector. Across the EU we are confronted with varied design, timing and pricing of spectrum auctions. We would like governments to realize that the price of spectrum should reflect further investments made by telecom operators. The priorities of the Greek presidency, concerning your members, are the development of a Digital Single Market, extension of broadband networks and the creation of systems to assure cyber and telecommunications security. It’s an ambitious agenda. What, in your opinion, is achievable and what questions will remain on the table? ETNO supports the Greek presidency on all ICT issues. Their working program is based on growth, so any of these proposals fit our priorities perfectly. They also plan to review the Digital
agenda targets that were set five years ago. At that time, the Commission was focusing on the supply side. We will support broadening the scope of Digital agenda targets towards policies and targets that drive investment and support growth. In this sense, we are sympathetic with those who believe that traditional telecoms regulation approaches are not viable with these new digital developments. We need to think about whether the policy is supportive of new changes, such as smart cities, e-health and connected TVs that improve social welfare, efficiency and positive environmental aspects. What are your major concerns regarding the Connected Continent regulation proposal and, if not adopted under this EP mandate, what approach would you recommend to future MEPs? Our major concerns at the moment are the open internet provisions. First, I must emphasize that we are for an open internet. We also believe that every measure must be innovation-friendly and allow the differentiation of services and offers by the industry, because different users have varied needs. The text on Connected Continent now being discussed in the European Parliament will affect our ability to deliver the most innovative services (IPTV, IP video, VPN and so called specialized services). If this text is passed, it would reduce the choices of users and hamper competition among our members with respect to the rest of the world. The proposal as such is very comprehensive, but consumers are usually interested in roaming prices. Is there an opportunity for European operators to reduce these prices and how might that be achieved? Operators are offering competitive prices, because clients ask to use their bundles, especially regarding data, wherever they travel in Europe. So our companies are committed to match customer needs. We only ask for regulatory consistency. In 2012, the EU institutions approved Roaming Regulation 3, which addressed exactly these same issues. Telecom companies are already investing to implement these measures. Going back to cyber-security, how can fraud, cybercrime and network security best be ensured? Trust is a key issue today. Our companies are committed to ensure that communications are safe and that both companies and individuals are protected from cybercrime. As far as cybersecurity is concerned, ETNO believes that crosssector regulation should replace sector-specific frameworks, especially now, when technological developments are revolutionizing the traditional value chain. For this reason, we welcomed the proposed NIS Directive, as it constitutes a first fundamental step towards recognizing the importance of security throughout the entire value chain. More specifically, we call on the co-legislators to recognize that e-communication providers
are already subject to several obligations in the information security field. We would therefore welcome a further clarification on the relationship between various existing risk management and incident reporting frameworks (Telecoms package, draft regulation on e-identification). The EU is currently negotiating a most important trade agreement with the US. Opening up markets will certainly bring competitive changes with the entry of new players. Is that an opportunity for your members or rather a matter of concern? Any regulatory discussion with such a large economic player is important. Overall, we think that growth and regulatory convergence should be the twin objectives of the negotiations. There are various areas where the scope exists to promote convergence of regulation between the EU and US. We ask for more convergent frameworks for our companies and an equal playing field with all internet players. Innovation has been the cornerstone of success in the mobile ecosystem and companies are pushed for constant development. What kind of funding can your members find under the new EU MFF 2014–2020? Many of our members will be actors under the Horizon 2020program. There will be also a new opportunity for members in the 5G Public-PrivatePartnership. Its aim is to build the communication network foundations for the coming decade and address future ‘connectivity’ needs in key societal and economic domains. The challenge for 5G PPP is to secure European leadership in particular areas where Europe is strong or where there is the potential for creating new markets such as smart cities, e-health, intelligent transport, education or entertainment & media. The total budget devoted by the public side of the 5G Infrastructure PPP is expected to total around €700 million in Horizon 2020 (European Commission), which is mirrored by €700 million committed by the private side. In addition to this, the expectation is that the telecommunications industry will invest five to ten-times this amount outside the partnership in activities that contribute to the objectives of the PPP. What opportunities does Connecting Europe Facility bring to your members? Compared with other sectors (transport and energy), the digital support from CEF proposed by the Commission at €9.2bn was reduced to €1bn at the February 2013 European Council. Can this amount generate significant investments? ETNO supported the CEF proposal since the beginning. Unfortunately, the outcome is not ideal and we hope the financial envelope destined to telecommunication sector will be used in the most cost effective manner. Thank you very much for the interview! Alena Mastantuono, Director of CEBRE – Czech Business Representation to the EU ■
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