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Europe vs USA telecom public policy: New rules for new times? (3. From diagnosis to delivery)

EuropeVsUSA3 As we have seen the situation in Europe is not very encouraging compared to the USA. Europe had the same policy starting point than USA, but evolution has been dissimilar, delivering different results.

 

However, the good news is that European regulators and politicians are increasingly recognising the competitive advantage and productivity enhancement that deployment of the latest telecom infrastructure can provide, and start making steps to see policies that will foster the necessary investments.

 

As Europe has just elected a new Parliament and a new Commission, there is an opportunity to rethink it all again and reform the existing regulatory framework and Telecom Single Market proposals. Europe has an opportunity to evolve to a more flexible and lighter regulatory telecommunications framework enabling the recovery of a growing path.

 

Regulation needs to evolve with market and industry. The key lies in striking the right balance between providing a level playing field, consumer protection and enabling innovation and sustainable growth for the industry. As Lowell C. McAdam, chief executive of Verizon Communications was recently saying “regulation must protect consumers and enable investment, while avoiding regulation that tries to outsmart the dynamic ecosystem.” “We believe a light-touch approach means a commitment by regulators to avoid adding artificial constraints on the marketplace that do not address a demonstrable harm to consumers".

 

It’s time to deliver, to accelerate Europe’s transformation with clear focus on supporting European networks and digital services. Policy priorities could start with the following:

 

1.- Ensuring that Europe becomes an Innovation & Investment friendly area

 

2.- Allowing the market structure to evolve towards its most efficient outcome, and

 

3.- Achieving a Level Playing Field

 

Captura1To facilitate innovation and an investment friendly area, we need a more market led approach, less regulatory driven, removing excessive ex-ante regulatory pressure, by

 

  • Adapting regulation to new market structures, fostering investment, by avoiding tight access regulation that could become a barrier to the deployment of new technologies, especially when there is scope for infrastructure competition (e.g. having same rules in NGN for former “incumbents” than for cable, avoiding unnecessary regulation)
  • Breaking out of the deflationary price spiral encouraged by cost oriented regulated prices, so pricing strategies can reflect the value of services, defined by the market.
  • Providing more room for innovative commercial solutions especially with timely & neutral spectrum in global market and by ensuring a principles-based Open Internet policy, rather than prescriptive net neutrality rules preventing innovation and new commercial propositions

 

Captura2Revisit consolidation and competition framework, allowing speed to scale and efficiencies, when competing with global champions, in new digital industry, by:

 

  • Letting players find the market structure that better serves the consumer & facilitates cost efficiency in capital-intensive industries
  • Reviewing Competition framework on account of new digital business models with effective enforcement both to local and global players
  • Fostering R&D framework, entrepreneurship, demand and digital skills

 

Captura3

Apply “same services-same rules” principle, and consistent rules to all elements of value chain and with other regions, by

 

  • Defining consistent rules for all elements of the value chain: Telecom operators subject to same rules than OTTs (Over-The-Top), when competing on same type of services (e.g. Skype for voice, Whatsapp for messaging, Netflix/YouTube for content distribution, Google, Apple, Amazon for all kind of cloud services…).
  • Supporting a Strong digital confidence framework by establishing the most adequate and consistent Privacy & Security & Transparency rules as well as safeguarding that consumers will not get locked in any specific platform, by ensuring Interoperability and the Portability of their digital life.

 

Not to miss the boat of global digital industry, and stay ahead of consumer demands, a real change in policy is needed in Europe, to go from diagnosis to delivery.

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