A single market with 27 regulators

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Presentation at the workshop on "Coordinating market regulation across the EU: transnational networks, EU agencies and hybrids" 21 June 2013

Presentation at the workshop on "Coordinating market regulation across the EU: transnational networks, EU agencies and hybrids" 21 June 2013

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  • 1. Ewan SutherlandLINK Centre, Wits UniversityCRIDS, University of NamurCoordinating market regulation across the EU21 June 2013 London
  • 2.  Scotland:◦ Yet another regulator; or◦ Some complex extra-legal, pseudo-federal network governance International mobile roaming:◦ 25 years of “regulatory” activities (1996-2022)◦ 9 years of statutory price controls (2007-2016)◦ A failure to address tax havens◦ Precious little to do with a single market Operators:◦ Reduced their geographic “footprints”◦ Actively pursuing consolidation within member states Telecommunications regulators:◦ Ensuring their independence◦ Entrenching their position◦ A Gordian knot of network governance Single market for telecommunications:◦ Neither the same as nor a prerequisite for the Digital Single Market◦ There are neither measures of nor data on harmonisation◦ What benefits are there for consumers and enterprises?Ewan Sutherland, June 2013, Coordinating market regulation across the EU 2
  • 3.  One of the four UK “nations” Plebiscite due in September 2014 Presumed to be(come) a member state of EU Would need a new set of regulatory bodies:◦ OFCOM, CMA, CAT, GCHQ, OTA2, ASA, etc.◦ With its own network governance Split the licences Split the markets Argued to be closer to the people SNP wants to aggregate all regulatorsEwan Sutherland, June 2013, Coordinating market regulation across the EU 3
  • 4.  Polling evidence says Scotland will stay in UK Need to rethink “devolution”:◦ Will additional powers be transferred? How to channel political and communitymessages to regulators? Engage with complex non-transparentnetwork governance coordination in:◦ Scotland◦ United Kingdom◦ European Union How to channel and coordinate state aid? Little evidence of preparation for this revampEwan Sutherland, June 2013, Coordinating market regulation across the EU 4
  • 5.  Original deal was to deliver economies ofscale for GSM manufacturers Operators would get to enter new markets A few premium customers could roam:◦ Handsets would not need further approval◦ Home country numbers would be used abroad◦ Up to 15 per cent surcharge on home prices The issue of high prices identified in 1998 Commissioner van Miert authorised initialinvestigation in 1999Ewan Sutherland, June 2013, Coordinating market regulation across the EU 5
  • 6.  Never expected to be a 25-year problem Without exception everyone made mistakes Few admit those mistakes:◦ Commissioner Kroes recanted her views Price regulation is very crude but effective However, there was no bounce in demand Structural remedies will not work Why has roaming taken up so much time?◦ What is it diverting attention from? Minimal relevance for the internal marketEwan Sutherland, June 2013, Coordinating market regulation across the EU 6
  • 7.  Regulators have been investigating operatorcosts for years or decades The issue of the use tax havens has neverbeen raised Yet not paying (much) tax greatly affectscosts Regulators have a massive trans-nationalnetwork which could address such mattersEwan Sutherland, June 2013, Coordinating market regulation across the EU 7They also failed to spot corruption
  • 8.  Old complaints about leased lines On-going U.S. regulation of “special access” Service providers failed in alliances Then they created their own networks:◦ Acquired networks from customers◦ Built facilities in foreign countries◦ Leased facilities from incumbent operators Some recent complaints from serviceproviders about incumbent operators Never added mobile to fixed VPNs:◦ A real market failureEwan Sutherland, June 2013, Coordinating market regulation across the EU 8
  • 9.  A long process to persuade member states:◦ Disinterest◦ Incomprehension◦ Lack of tradition Gradual improvements EC still pressing member states◦ Romania, Spain, Netherlands, etc. NRAs now seen to be permanent◦ Sunset clauses have failed◦ Regulation will never end But, do we still need the NRAs?◦ They have not delivered competition◦ Market analyses and remedies will continue for years◦ They cannot deliver a telecoms internal market◦ Could use “big data” insteadEwan Sutherland, June 2013, Coordinating market regulation across the EU 9
  • 10.  Communications Committee (COCOM) Radio Spectrum Committee (RSC) Article 7 procedures Associations and groups:◦ Independent Regulators Group◦ European Regulators Group I◦ European Regulators Group II◦ Body of European Regulators of ElectronicCommunications (BEREC) Enduring divergences arise from:◦ Transposition of directives◦ Implementation by regulators◦ Decisions by national appellate bodies◦ Unanticipated creativity of national regulatorsEwan Sutherland, June 2013, Coordinating market regulation across the EU 10
  • 11.  Single European Act:◦ To be completed in 1992 Liikanen contribution to Lisbon Agenda:◦ “the most competitive and dynamic knowledge-basedeconomy in the world” Monti Report on the internal market:◦ No digital internal market◦ Digital single market represented a one-off €500 billionpotential boost to EU GDP Jobs and Growth 2020 Digital Agenda for Europe A digital supply chain Digital invoicingEwan Sutherland, June 2013, Coordinating market regulation across the EU 11“A radical legislative compromise”Commissioner Neelie Kroes
  • 12.  Action 18: Harmonisation of numbering regimes Action 19: Spectrum Policy plan Action 20: Investigate the cost of non-Europe in thetelecoms market Action 42: Adopt an EU broadband communication Action 43: Funding for high-speed broadband Action 44: European Spectrum Policy Programme Action 45: Foster the deployment of NGA networks Action 48: Use structural funds to finance the roll-outof high-speed networks Action 49: Implementing the European Radio SpectrumPolicy Programme in Member States Action 101: Look for durable solutions for voice anddata roaming by 2012Ewan Sutherland, June 2013, Coordinating market regulation across the EU 12http://ec.europa.eu/digital-agenda/en/our-goals/
  • 13.  Digital Single Market:◦ Is very much more than a single telecoms market◦ Does not require a single telecoms market What would it require?◦ A single regulator: Commissioner Reding at BITKOM Commissioner Kroes on Monday “not pragmatic”◦ A single number for Europe: European Telephony Number Space◦ Multi-country spectrum assignments: GMPCSEwan Sutherland, June 2013, Coordinating market regulation across the EU 13
  • 14.  No single market with 27+ regulators Tighter coordination will take decades Better/easier just to get rid of the NRAs◦ If you want a telecommunications single market Roaming regulation is an abomination◦ Not based on competition or market analyses Do not appear to be real consumer benefitsfrom a single telecommunications marketEwan Sutherland, June 2013, Coordinating market regulation across the EU 14
  • 15.  International mobile roaming:◦ Market definition(s)◦ Market failure(s) Regulation:◦ What was roaming regulation diverting us from?◦ How might we measure harmonisation? Trans-national services for business Measuring harmonisation Operators geographic scope What comes after “ladders of investment”?Ewan Sutherland, June 2013, Coordinating market regulation across the EU 15
  • 16.  Ewan Sutherland sutherla [at] gmail.com http://anti-corruption-telecoms.blogspot.com/ http://www.ssrn.com/author=927092 +44 141 649 4040 skype://sutherlaEwan Sutherland, June 2013, Coordinating market regulation across the EU 16