The document discusses challenges with coordinating telecommunications market regulation across the European Union. It notes that international mobile roaming regulation has taken up significant time and resources over 25 years without fully addressing the issues. It also questions whether national telecommunications regulators are still needed given they have not delivered competition or a true single market. The document argues that tighter coordination of regulations will be a long process and eliminating national regulators may be easier to achieve a single telecommunications market in the EU.

1. Ewan Sutherland
LINK Centre, Wits University
CRIDS, University of Namur
Coordinating market regulation across the EU
21 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 regulators
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4.  Polling evidence says Scotland will stay in UK
 Need to rethink “devolution”:
◦ Will additional powers be transferred?
 How to channel political and community
messages to regulators?
 Engage with complex non-transparent
network governance coordination in:
◦ Scotland
◦ United Kingdom
◦ European Union
 How to channel and coordinate state aid?
 Little evidence of preparation for this revamp
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5.  Original deal was to deliver economies of
scale 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 initial
investigation in 1999
Ewan 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 market
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7.  Regulators have been investigating operator
costs for years or decades
 The issue of the use tax havens has never
been raised
 Yet not paying (much) tax greatly affects
costs
 Regulators have a massive trans-national
network which could address such matters
Ewan Sutherland, June 2013, Coordinating market regulation across the EU 7
They 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 service
providers about incumbent operators
 Never added mobile to fixed VPNs:
◦ A real market failure
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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” instead
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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 Electronic
Communications (BEREC)
 Enduring divergences arise from:
◦ Transposition of directives
◦ Implementation by regulators
◦ Decisions by national appellate bodies
◦ Unanticipated creativity of national regulators
Ewan 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-based
economy in the world”
 Monti Report on the internal market:
◦ No digital internal market
◦ Digital single market represented a one-off €500 billion
potential boost to EU GDP
 Jobs and Growth 2020
 Digital Agenda for Europe
 A digital supply chain
 Digital invoicing
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“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 the
telecoms 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-out
of high-speed networks
 Action 49: Implementing the European Radio Spectrum
Policy Programme in Member States
 Action 101: Look for durable solutions for voice and
data roaming by 2012
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http://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:
 GMPCS
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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 benefits
from a single telecommunications market
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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://sutherla
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