The European Parliament and the Council reached late on 5 June a political agreement to update the EU’s telecoms rules. The new European Electronic Communications Code, proposed by the Commission, will boost investments in very high capacity networks across the EU, including in remote and rural areas.
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Why are the EU telecoms rules being revised?
In the last two decades, the current telecom rules have contributed to transform the telecoms landscape from monopolies to a competitive market with a wide range of offers and better protection for consumers.
Networks in the EU have so far been developed at a national or sub-national level; they stop at our borders. In parallel, the existing rules guarantee the availability of a minimum set of services, which was necessary for digital inclusion at the time but is insufficient to nurture future technological developments.
The Commission’s proposals on telecommunications markets presented in September 2016 strive to put the EU at the forefront of internet connectivity by 2025 to create a Gigabit Society. The Commission estimates that reaching these objectives will require 500 billion investment over the coming decade, largely coming from the private sector. Under the current telecommunication investment trends, however, this amount is likely to fall short by 155 billion.
The telecoms rules must support the creation of Gigabit Society. By making investment in very high capacity networks a binding objective and focusing on facilitating the roll-out of new very high capacity networks, the new rules promote sustainable long term competition.
How will the new rules on spectrum help deliver 5G?
Next generation data communication 5G, the future wireless and mobile communications -, will require additional radio frequencies, a timely access to spectrum and targeted improvements in the spectrum management. 5G will offer a multitude of new opportunities for citizens and businesses with services crossing national frontiers. That is why 5G roll-out cannot just be a national matter.
The new rules will pave the way for 5G network deployment, to secure radio spectrum resources via more harmonised decisions and common deadlines and, therefore, to meet the connectivity targets for a Gigabit Society. In particular, they will ensure that the pioneer spectrum bands, i.e. the bands on which the new services will be provided (26 GHz and 3.6 GHz, in addition to 700 MHz), will be available at the same time (by the end of 2020) all over Europe in the same technical conditions. They also lay the foundations for a broad exchange of best practices in the area of spectrum assignment to ensure that mistakes costly in time and money are avoided and that Member States can benefit from an effective peer exchange.
The Code will be of major benefit to both industry and users of connected cars and infotainment, health care, and the Internet of Things all of which rely on the timely deployment of 5G technologies. In particular 5G Fixed Wireless Access solutions, especially in the mm-waves bands (26 GHz band), will offer significant investment opportunities.
How the new rules will benefit to future 5G services and applications?
Future networks, supporting automated driving or eHealth will need to interconnect and work together as if they were building blocks of a seamless virtual network. For this to happen it is important that 5G is deployed at the same time all over Europe.
The Code will be of major benefit to both industry and users of connected cars and infotainment, health care, and the Internet of Things all of which rely on the timely deployment of 5G technologies. In particular 5G Fixed Wireless Access solutions, especially in the mm-waves bands (26 GHz band), will offer significant investment opportunities.
Once the EU targets are met and very high capacity networks are widely available rich and widespread 5G services will be possible in very diverse sectors. Their availability will increase the competitiveness of the EU on a global scale. For example: (i) hundreds of machines in a factory connected and cooperating in real-time capable of learning and exchanging information leading to high performance systems and products, (ii) healthcare system professionals will have the ability to monitor a patient’s condition remotely, resulting in a reduction of hospital stays, iii) cities adapting energy consumption or traffic lights based on real-time needs, and (iv) students studying at various universities throughout Europe at the same time.
What other changes brings the Code as regards radio spectrum?
The provisions on radio spectrum in the Code will ensure:
– 20 years investment predictability and usage flexibility for long term spectrum licences for wireless broadband and clear rules for renewal of such rights,
– timely assignment of radio spectrum after harmonisation of technical criteria for specific usage of bands across the EU,
– enhanced co-ordination and peer review of planned radio spectrum assignment procedures,
– setting appropriate radio spectrum fees to encourage investments by licence holders and entry of new spectrum users,
– facilitating shared infrastructure and spectrum usage to cover the whole EU territory faster and more efficiently,
– eliminating cross-border interference issues within the EU as well as with third countries and
– facilitating the deployment of small cells (small size mobile base stations that can reach several meters), necessary for dense 5G networks and WiFi.
What will be the role of Member States in assigning the bands? Are there any changes?
Spectrum is a public resource that is essential for economic development, media pluralism, social inclusion, territorial cohesion and national security.
While spectrum assignment will remain a prerogative of Member States, consistency of conditions for assignment is significantly reinforced under the new rules of the Code which reinforces the single market approach. Member States will remain competent to set the policy objectives, in terms for instance of coverage obligations and reserve prices.
How the new rules will encourage telecoms operators to invest in high-capacity networks?
The Code puts emphasis on access to civil infrastructure, such as masts, ducts and cabinets. Such access will lower significantly the cost that smaller players have to incur for deploying their own networks.
The new predictable rules on co-investment will benefit all players, both the incumbent and others, who are ready to invest in new very high capacity networks. The rules will provide them with opportunities to participate in the deployment of the new very high capacity networks on fair and flexible terms, at a scale and with a model that fits their operational and financial abilities. This means that they will be able to compete effectively, and the Code will promote risk sharing in building new networks.
Also pure access seekers, i.e. the operators that are not yet able to deploy their own networks or participate in co-investments, will still be able to provide competitive services. Gradually, they will also be able to take advantage of the capabilities of the new networks, maintaining the competitive pressure on the bigger operators. Moreover, based on the new rules for symmetric regulation, access seekers will be able to reach more end-users, which were previously inaccessible to them due to technical or economic bottlenecks. The general obligation on all operators who control the wires and cables connecting end-users to the network (so called in-house wiring) to give access to their competitors is an effective tool in this respect.
Pure wholesale-only operators, i.e. the operators that do not provide services directly to end-users, can also benefit a priori from a lighter regulatory treatment in case they are found to hold significant market power. Such regulatory treatment is justified by the potential of wholesale-only models to enhance competition at the retail level, for the benefit of consumers. This specific regulatory regime for wholesale-only operators supports business models which in particular in less densely populated areas ensure that service-based competition is ensured if the business case for parallel networks is weak.
How the new rules will benefit the consumers?
As more end-users are using different types of services to communicate, the new rules will enhance protection irrespective of whether they communicate through traditional (call, SMS) or web-based services (Skype, WhatsApp, etc.). This should facilitate increased consumer trust and transparency in the sense that similar protection would apply to similar services, for example by ensuring that security provisions are applicable to all services.
The Code also harmonises the end-user protection rules at EU level to ensure end-users a high level of consumer protection wherever they are in the Union. This will ensure better consistency and legal certainty for providers of electronic communications in the EU.
The new end-user’s rules in the Code will also:
– Protect consumers subscribing to bundles, for example by avoiding lock-in effects through disproportionate compensation fees for bundled terminal equipment;
– Facilitate change of provider and strengthen number portability;
– Enhance comparison tools and consumption control;
– Promote tariff transparency and comparison of contractual offers enabling end-users to make informed decisions.
How the new rules will decrease the cost of intra-EU calls?
The new rules will ensure that consumers are protected from excessive prices for intra-EU calls, including those that do only occasionally international calls to other European countries. The agreement found is also making sure that the new rules would not distort competition, innovation and investment. A new safeguard cap to telecom operator’s prices for calls from home to other EU countries will ensure from May 2019 onwards that consumers can make intra-EU calls at a price not exceeding 19 cents per minute and send SMS for 6 cents. The cap that has been already applied in the past for regulated roaming tariffs will now represent also a safety net for intra-EU calls.
How will consumers benefit from new universal service obligations?
All EU consumers, regardless of their location or income, will be ensured the connectivity to be able to participate in the digital economy and society. The recently agreed provisions will ensure that a universal service broadband and voice communications will be available to all end-users and that they will be affordable for consumers. The broadband must have at least sufficient bandwidth for using important online services used by majority of consumers, for example, internet banking and eGovernment services.
How the rules will benefit people living in rural areas?
Citizens and business from rural areas will benefit from the boost of connectivity which the new rules will bring. The telecoms rules will support the ambition to build a Gigabit Society all over the EU. Therefore the new rules put an emphasis on investment incentives and reinforcing infrastructure-based competition. For example, a specific regulatory regime for wholesale-only operators supports business models which in particular in less densely populated areas ensure that service-based competition is ensured if the business case for parallel networks is weak. Regulatory authorities are also given tools to identify areas where the prospects for very high capacity connectivity are weak and provide investment predictability in those areas for interested investors.
Several changes have also been agreed to the current way of managing radio spectrum. Member States will have an obligation to ensure timely and consistent assignment of the bands which will be used for the deployment of 5G services across the EU.
Moreover, the universal service will guarantee that all EU consumers, regardless of their location or income, will be ensured the connectivity to be able to participate in the digital economy and society. The broadband communication must have at least sufficient bandwidth for using important online services, for example, internet banking and eGovernment services.
What do the new rules say about emergency services?
The Code provides that caller location information can be retrieved from both the network and, where available, from the handset itself.
In order to accommodate developments in use of new technologies the Code clarifies that the concept of emergency communications includes not only voice but also text, video and other types of communications. This also helps to improve the accessibility for end-users with disabilities to reach emergency services.
What are the new provisions in relation to public warning systems?
Recent terrorist attacks in Europe have highlighted the need for more efficient public warning systems in the Member States. In order to increase the protection of citizens in the Union, the Code therefore includes a provision to establish a system that transmits public warnings to citizens on their mobile phones.
Such a public warning system will enable citizens and travellers to be informed of imminent or developing threats in the area where they are located.
Are there any changes as regards the powers of national regulatory authorities or the functioning of the Body of European Regulators for Electronic Communications (BEREC)?
The national regulatory authorities (NRAs) and other competent authorities will remain responsible for applying the new rules in each Member State. The Code also reinforces the independence and competences of NRAs, which should be in charge or at least associated in all the core telecoms regulatory tasks.
Although co-legislators did not agree to revamp BEREC and the BEREC Office into a fully-fledged agency, the mandate has been enhanced with additional tasks which are relevant for the telecoms market, such as issuing an opinion in the determination of termination rates and issuing guidelines to ensure consistency of symmetric regulation. In particular, BEREC will have a key role in supporting the Commission in exercising control that the new rules on symmetric regulation and co-investments are consistently applied across the Union.
Source: European Commission
