Friday, October 24, 2008

A universal service obligation for broadband?

Further to my previous post, discussions are underway within the European Commission regarding possible reform of universal service obligations for telecommunications to include broadband provision, which is not a requirement at present.

Some recent additional news coverage of this issue:

Commission Calls for Broadband Access for All Europeans

The Commission's 2008 Report on the Scope of the Universal Service in Telecoms: FAQs

There are a couple of very interesting aspects to this. Firstly, if broadband is included in a future USO, this could have a significant impact on the UK, where there are a not insubstantial number of "notspots" beyond the reach of DSL services, primarily as a result of either line quality or the distance from an exchange. How might a new USO require these to be addressed?

Secondly, proposals to mandate transparency of traffic shaping polices are also being considered, as referenced in the recent Caio review. Taken together, thse two developments would represent quite a shift in the broadband marketplace?

This recent communication from the European Commission has this to say about a possible broadband USO:

"Coverage of broadband networks is now very high in most Member States, being available, on average, to 90% of the EU population. Use of the internet is now approaching the level of a service used by the majority, with 49% of EU households using the internet, 36% of which are on broadband. Although broadband is not yet used by the majority of consumers (the first of two considerations identified in Annex V of the Directive) and is therefore not encompassed by the USO as laid down and described by the present wording, take-up is approaching the threshold of use by a majority of consumers. Furthermore, it is reasonable to anticipate that, in a relatively short horizon of time, narrowband will no longer answer the requirement of being "sufficient to permit functional internet access" (as laid down in Article 4(2) of the Directive). Thus the situation does need to be kept under review."

This debate is set to continue for some time, as the Commission doesn't expect to propose any new legislation before 2010.

Additional recent communications address the second aspect, suggesting transparency of traffic shaping should be a mandatory requirement. This one, a speech by Viviane Reding, Member of the European Commission responsible for Telecommunications, on 2nd September 2008, has this to say:

"Competition brings with it lower prices, better quality services and more choice, so consumers are the real winners! But I do not kid myself, and I can see the Parliament shares these concerns: choice needs to be real. Consumers need to be empowered to make the most of competition and that also means being properly informed. That is why the enhanced ability to switch your supplier is so important, and why I welcome Parliament's support on the need to ensure that number portability is completed within 1 day. If it can happen in Australia in 2 hours, then 1 day should be entirely feasible in Europe. I also welcome the clarity that Parliament has added with its changes on enhanced consumer information; so that consumers really know what service they are getting from their providers and can make useful comparisons. This enhanced transparency also serves to support the open architecture of the internet. If there are any restrictions on accessing the internet, it is imperative that consumers are clearly informed of what those restrictions are. I am glad to see that both the Commission and the Parliament stand in agreement on these points."

...while this one provides a little more detail:

"For the European Commission, the open architecture of the Internet is of key importance for the Information Society. The Commission in particular considers that the following "net freedoms" should be general guidelines for regulators and policy makers: right for users to access and distribute (lawful) content, to run applications and connect devices of their choice.

The Commission therefore proposes, in the EU Telecoms reform, a transparency mechanism concerning possible restrictions on consumers’ choice of lawful content and applications so that consumers can make an informed choice of services and reap the full benefits of technological developments. In practice, consumers will get clear and timely information from their service providers about any restrictions that the providers place on their access to or use of Internet or mobile content and applications. This will allow them to pick and switch to the operator which best suits their needs. Where consumers have no alternative, service providers should not be allowed to block or restrict such access."

Worth keeping an eye out as these developments progess through the EU legislative process. More on this in an article from Silicon News:

Fibre era fraught with roadblocks: EC,39024659,39283620,00.htm

"Following the European Parliament's first reading of the EU Telecoms reform proposals on 23 September, the European Council of Telecoms Ministers will then discuss the proposals on 27 November. The EC reckons a political agreement on the final legislative texts could be achieved by the end of the year, with a new regulatory framework potentially becoming law in all 27 EU Member States by 2010."

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