Convinced the Office of Communications (Ofcom) intends to announce a decision Thurs. allowing British Telecom (BT) to hike prices on some wholesale broadband products, the U.K. Internet Federation (UKIF) said it’s already talking to members of Parliament and assessing what it might do at the European Union level to counter BT’s move, a spokesman told us. UKIF members worry the price increase for some IPStream office products could bankrupt them. IPStream provides end- to-end broadband service from customers’ connections to phone exchanges and ISP servers. On Aug. 20, UKIF members, small to mid-sized ISPs, met with Ofcom and submitted a response to the regulator’s current consultation on the “margin squeeze” between IPStream and BT’s DataStream, products that allow large ISPs to purchase local broadband access from BT but give their own customers connectivity on their or someone else’s network. UKIF criticized both the substance and process of the consultation, saying Ofcom: (1) Didn’t adequately consult with IPStream customers most likely to be hurt by BT’s price increase. (2) Applied the wrong regulatory test. Instead of using the “retail minus” or “margin squeeze” test, UKIF said, Ofcom should have taken a “cost-plus approach.” (3) Failed to recognize IPStream and DataStream are competing products. Although the submission was filed late, UKIF said, it has been assured Ofcom will consider it. Even so, the group said last Fri.’s meeting “left a rather bad taste in the mouth” because the “overriding feeling” was that the regulator had already made up its mind. A BT spokesman said the telco will respond to any concerns Ofcom raises. Ofcom’s decision is due for publication this month and UKIF’s comments will be taken into account, a spokesman said.
Dugie Standeford
Dugie Standeford, European Correspondent, Communications Daily and Privacy Daily, is a former lawyer. She joined Warren Communications News in 2000 to report on internet policy and regulation. In 2003 she moved to the U.K. and since then has covered European telecommunications issues. She previously covered the U.S. Occupational Safety and Health Administration and intellectual property law matters. She has a degree in psychology from Duke University and a law degree from the University of Tulsa College of Law.
A U.K. ISP coalition is to meet with the country’s telecom regulator today (Fri.) about a British Telecom (BT) proposal to raise prices on some business broadband products. The incumbent telco this month announced higher wholesale prices on its IPStream end-to-end services. That prompted dismay from some 70 small ISPs, which formed the U.K. Internet Federation (UKIF) to fight the increase. In teleconferences this week and previously, UKIF and BT tried to settle their differences but failed, UKIF said, because BT continues to blame the Office of Communications (Ofcom) for the higher price. Ofcom is reviewing the wholesale broadband access market -- BT’s DataStream products -- and has floated the idea of a “margin rule” under which the telco would be required to maintain a pricing gap between IPStream and DataStream products to spur competition. At today’s meeting, UKIF members will criticize Ofcom’s consultation as flawed because “hardly any organisation” affected was aware of it, the group said. It will also contend Ofcom misapplied its regulatory framework. UKIF is “confident” Ofcom will “appreciate the immediate and very real damage which increases in IPStream will bring to the UK broadband market,” it said.
A British Telecom (BT) proposal to hike wholesale prices on some broadband products sparked a firestorm of criticism from small ISPs who say the move could put them out of business. More than 70 ISPs formed a coalition to fight the increase. Incumbent telco BT says it’s caught between its service provider customers and the U.K. telecom regulator, Office of Communications (Ofcom).
European Commission (EC) Pres.-designate Jose Barroso Thurs. unveiled his roster of new commissioners, calling them a “high quality and political team.” The new EC will take office Nov. 1 assuming the European Parliament (EP) approves his choices. It will have the highest proportion of women -- including the commissioners responsible for Internet, telecom and competition matters -- ever in the EC, ex-Portuguese Prime Minister Barroso said.
Two U.K. mobile companies overcharged other European mobile network operators (MNOs) for international roaming, the European Commission (EC) said Mon. In separate “statements of objections” sent to Vodafone and O2, the EC said the companies charged wholesale rates for other MNOs’ subscribers to use their mobile phones in the U.K., hurting consumers traveling there. The probe showed that from 1997 until at least the end of Sept. 2003, Vodafone abused its dominant position in the U.K. market for the provision of international roaming services at wholesale level on its own network by charging “unfair and excessive prices” to European MNOs, the EC said. O2 did the same thing between 1998 and last Sept., the Commission said. Providing wholesale airtime access to U.K. subscribers of independent service providers “bears considerable similarities” to providing wholesale international roaming services to foreign MNOs whose subscribers use their mobiles when roaming in the U.K., the EC said: “The Commission therefore questions the enormous price differentials between two fundamentally comparable services.” Vodafone and O2 have been given the opportunity to respond to the preliminary findings in writing and in a hearing, the EC said. Vodafone is reviewing what is, after all, a “preliminary position” and will respond accordingly, a spokesman said. The U.K. telecom regulator, Office of Communications, isn’t involved in the case, a spokesman said. However, he said, there are “wider questions about international roaming” which require cooperation across different countries’ regulators and which continue to be looked at by the European (telecom) Regulators Group. Also Mon., the Commission issued a memo saying it’s investigating the competitive conditions in Germany’s wholesale market for international roaming, and looking into notifications by the GSM Assn. with regard to standard terms for international roaming agreements in relation to voice and GPRS-based data communications. The Commission said it expects the various proceedings to spur greater competition. Eighty-one percent of European citizens now have mobile phones, the EC said.
The British govt. Thurs. pushed back the switchover from analog to digital TV (DTV) 2 years, saying some public broadcasters wanted the delay. In a written statement to Parliament, Culture Secy. Tessa Jowell said while broadcasters hadn’t agreed on the best timetable, some -- including the BBC -- thought 2012 would be more appropriate than the 2010 deadline originally floated by the govt. But she said rollout would be “subject to agreement on a detailed plan, including resolution of the remaining issues” raised in talks among the govt., public service broadcasters and the Office of Communications (Ofcom). Industry groups welcomed the statement and urged the govt. to set a definite date, while one consumer group worried that consumers might be forced into something they're not ready for.
The European Commission (EC) is preparing to launch a consultation on whether European Union-wide policies are needed to spur development of digital rights management (DRM) technologies in Europe. The consultation will be based on a report issued this month by the EC’s High Level Group (HLG) on DRM, whose participants include content providers, rights- holders, publishers, broadcasters, mobile and fixed operators, equipment manufacturers, DRM solutions providers, researchers and consumers. The report reflects consensus among stakeholders on DRM and interoperability; private copying levies and DRM; and migration to legitimate online services. The HLG report acknowledged that “market forces are the primary driver of DRM and interoperability solutions, but that time is needed.” Nevertheless, it said, action is required on several fronts: (1) Industry work further on open cross-platform DRM systems. (2) The EC must push for deployment of open standards by continuing to support the work of relevant standards bodies. (3) European Union (EU) member states must ensure that DRM standards aren’t undermined by noncompliance and that they have effective antipiracy laws in place. Market development of DRM is at an early stage, though technological development is fairly advanced, the HLG said. Most consumers lack devices equipped to make use of services offered through DRM, it said, and industries have developed systems based on their own specific characteristics. There’s wide consensus that open standards offer the most realistic chance for true cross-platform interoperability of devices, the group said. But DRM encompasses security aspects as well as interoperability, the HLG said, and “it is challenging to devise open standard solutions that can simultaneously ensure that security is not eroded.”
European Union (EU) justice ministry officials are seeking to update information from member states on their uses of, and attitudes toward, retaining communications traffic data for law enforcement and other purposes. The short questionnaire, issued late last month by the EU Council’s Working Party (WP) on cooperation in criminal matters, follows up a 2002 survey on data retention. The updated information will likely figure into whatever action the European Commission (EC) ultimately takes on a controversial proposal from France, Ireland, Sweden and the U.K. for a framework decision that could force communications service providers (CSPs) to hold telecom and Internet traffic data as long as 36 months. The proposal has reportedly already drawn fire from German privacy authorities, and is the subject of an imminent report from EU data protection officials.
U.K. legislation aimed at clearing road congestion but raising concerns of telcos moved closer to passage Tues. following a debate in the House of Lords. The Traffic Management Bill (TMB), floated by the govt. last Nov., envisions a permit scheme for any road work, including laying conduit. Telcos and other utilities criticize the measure for hampering their work and imposing red tape -- creating costs that will be passed along to customers. Opposition peers floated several amendments telcos claimed would limit the bill’s harmful effects. While these were all withdrawn during the debate, they helped persuade the govt. to take telcos’ concerns into account, said Domhnall Dods, chmn. of the U.K. Competitive Telecoms Assn. (UKCTA) govt. relations committee.
The voting may have ended last week, but Europe’s telecom sector won’t know for some time how it fared in the election of members of the European Parliament (MEPs). While the balance of power in the EP remained essentially static, the greatest unknown is the makeup of the various committees that deal with telecom and Internet issues. The impact of the loss of several key privacy and digital rights supporters is also unclear.