Super-fast mobile – 4G
Frederique Dupuis-Toubol and Katia Duhamel
The French NRA (ARCEP) is preparing an upcoming call for applications for the allocation of 800 MHz and 2.6 GHz band frequencies to be used for the deployment of super-fast mobile networks, commonly named "4G" or fourth generation.

By way of reminder, the effective 800 MHz band, resulting from the digital dividend, is considered attractive to network operators because it enables national coverage with less equipment and therefore less investment. The so- called "golden frequency", is intended mainly, but not only, for town and country digital planning. The 2.6 GHz frequencies have less advantageous propagation characteristics and are intended to provide additional capacity in urban areas.

The definition of allocation process was subject to public consultations launched in March 2009 and July 2010. Thereafter, ARCEP decided to award the frequencies through an auction process in which the first criterion is the price offered by the bidders with regard also to specific conditions i.e. geographical coverage, network sharing, hosting MVNOs (the other criteria). ARCEP is also expected to issue a draft specification of the future licence shortly.

To help stakeholders lay the groundwork for these new networks, ARCEP is issuing temporary authorisations for specific locations to allow technical trials. Several dozen trials in the 2.6 GHz band have already been authorised. In addition, ARCEP has issued the first temporary authorisation for a trial in the 800 MHz band and is processing further requests. For example, resources have been assigned to Alcatel-Lucent to allow the company to perform technical trials at a site located in Lannion (ARCEP Decision no. 2010-1235, of 16 November 2010). ARCEP is going to continue to issue temporary authorisations while guaranteeing perennial licences in the 800 MHz and 2.6 GHz bands to the candidates who apply for it and who will have to complete details on all of the authorised trials, prior to the deadline set for submitting their application.

The spectrum is expected to be awarded to selected candidates in the second half of 2011, opening the way for super-fast mobile services in the coming years.

Return to top

German NRA publishes draft decisions for new mobile termination rates
Sven-Erik Heun and Valerian Jenny
On 30 November 2010, the German NRA Bundesnetzagentur ("BNetzA") published new termination rates for the four German mobile network operators. The mobile termination rates have been one of the major conflict areas of German telecommunications regulations for several years. The published new rates lie in the range 3.33 ct/min to 3.37 ct/min. This is a significant reduction in comparison to the previous rates of 6.59 ct/min. for T-Mobile and Vodafone respectively 7.14 ct/min for e-plus and O2. According to Matthias Kurth, President of the BNEtzA, this significant reduction is driven to a large extent by the strong increase in mobile network traffic volume.

The new termination rates are currently subject to German national consultation procedures as well as a subsequent notification to the European Commission. Until completion of these procedures, the new termination rates have been approved on an interim basis. A final decision is planned after completion of these procedures and expected for the middle to the end of the first quarter of 2011. Once enacted, the final decisions on mobile termination rates will apply retroactively from 1 December 2010 and will override the preliminary decisions taken.

For more information, please refer to BNetzA's press release dated 30 November 2010 at:
www.bundesnetzagentur.de/cln_1931/SharedDocs/Pressemitteilungen/EN/2010/
101130NewMobileTerminationRates.html?nn=48242

Unauthorised WiFi access

Sven-Erik Heun and Valerian Jenny

The practice of accessing open WiFi-systems of others without permission (so-called piggybacking) is not explicitly governed in German law. In 2007, the local court of Wuppertal held that doing so constitutes an unlawful interception of radio signals, a criminal offence prohibited by Sections 89 and 148 of the German Telecommunications Act as well as an unlawful retrieval of personal data that are generally accessible as prohibited by Sections 43 and 44 of the German Federal Data Protection Act.
 

The Wuppertal court's ruling has been widely criticised in German legal literature. In particular, critics noted that piggybacking doesn't usually entail obtaining any personal information concerning the owner of the WiFi-system in question nor does it entail the reception of any communications of the owner. In spite of this criticism, the ruling of the Wuppertal court was the leading German precedent on the legality of piggybacking for several years.

A decision of the same court passed in August of 2010 has now given up this legal view. In its reasoning, the court explicitly acknowledges the criticism of its ruling of 2007. This new legal view has been upheld by the regional court of Wuppertal in a ruling dated 19 October 2010 (case file number 25 Qs 10 Js 1977/08-177/10). Based on these two new precedents, piggybacking is not illegal in Germany, as long as one does not intercept any personal communications or access personal information of the WiFi-system's owner.

German NRA publishes proposal of its annual Strategic Plan

Sven-Erik Heun and Valerian Jenny

In its official gazette of 22 December 2010, BNetzA has published its proposed strategic plan for the year 2011. The proposed strategic plan is now subject to consultation by interested parties ending 19 January 2011. After this consultation, the strategic plan will be included in BNetzA's annual report on the development of the German telecommunications market.

The strategic plan outlines matters of legal and economic policy to be addressed by BNetzA in the current year. Among the topics listed are the reform of German telecommunications law to implement the most recent changes in the European Regulatory Framework, network neutrality, various consumer protection issues and spectrum policy. While the deadline to comment on the draft has already expired, the proposed strategic plan can be used as a reference document of BNetzA's regulatory agenda for the coming months.

Return to top

Italian Telecoms and TV Broadcasting Regulation - status of the analysis of the relevant markets
Eutimio Monaco and Sara Santaloia
The Italian NRA has concluded an analysis of some markets defined by the EU Commission Recommendation of 17 December 2007 (2007/879/EC) 'on relevant product and service markets within the electronic communications sector susceptible to ex ante regulation', in accordance with Directive 2002/21/EC of the European Parliament and of the Council on a common regulatory framework for electronic communications networks and services (2007 Recommendation), as well as the second cycle of the analysis of some markets - identified under the former Recommendation No. 2003/311/EC - no longer provided by the 2007 Recommendation,[1] given that in the NRA's view, some markets of the former Recommendation could still need an ex ante regulation in the light of the possible results of the triple test provided by the 2007 Recommendation.[2]

The markets are the markets for 'access to fixed network' (markets No. 1, 4 and 5 of the 2007 Recommendation), markets for the 'international telephone services available to the public supplied at fixed locations for residential and non-residential customers' (markets No. 4 and 6 of the 2003 Recommendation), the market for the 'retail line rental' (markets No. 7 of the 2003 Recommendation), markets for 'wholesale line rental' (markets No. 6 of the 2007 Recommendation and No. 14 of the 2003 Recommendation), markets concerning 'collection and termination on public fixed network' (markets No. 2 and 3 of the 2003 Recommendation) and the market for the 'transit service on public fixed network' (market No. 10 of the 2003 Recommendation). Meanwhile, examination continues (but seems to be about to conclude) into markets for 'publicly available local and/or national telephone services provided at a fixed location for residential and non-residential customers' (markets No. 3 and 5 of the 2003 Recommendation) and the market for radio and TV broadcasting transmission of contents to end-users (market No. 18 of the 2003 Recommendation, no longer included in the 2007 Recommendation).

The NRA, except for few cases, has substantially confirmed the framework of the EC, thereby considering as non-susceptible to ex ante regulation many markets excluded from the listed markets of the Annex of the 2007 Recommendation.

Return to top

1. The 2007 Recommendation has repealed the former 2003 Recommendation and has identified just seven markets instead of the 18 of the former Recommendation, since in the view of the European Commission just these seven markets need an ex ante regulation.
2. As for the mentioned test, the European Commission has elaborated three criteria that have to be cumulatively met in order to identify markets that are susceptible to ex ante regulation.  These criteria are: the presence of high and non-transitory barriers to entry; the unlikelihood of a development of the structure market towards effective competition within the relevant time horizon; and the ineffectiveness of competition law to rectify the market failure(s).
 

Market update
Marjolein Geus and Feyo Sickinghe
The Dutch telecommunications market shows further consolidation with the takeover of business telephony provider Atlantic Telecom by KPN. The roll out of fibre-to-the-home by Reggefiber slowed down in 2010 to 150,000 new connections instead of the planned 400,000 new connections. With 89% country-wide availability of cable and Eurodocsis 3.0 with broadband speeds of 100 Mbps, the Netherlands has already reached the goals of the European Digital Agenda that seek to ensure that, by 2020, (i) all Europeans have access to much higher internet speeds of above 30 Mbps; and (ii) 50% or more of European households subscribe to internet connections above 100 Mbps.

OPTA has started the process for new market analysis decisions with respect to local loop unbundling, wholesale broadband access, leased lines, fixed telephony, fixed and mobile terminating access and access to cable. Market parties are invited to contribute to the consultation process. New competition issues arise in the context of the emergence of a duopoly between KPN and cable companies and the lack of an effective ex ante price squeeze test. The auction process for the digital dividend (800 MHz) is planned in 2012.

Return to top

Mobile Termination Rates – Polish case
Marlena Wach
In 2006 and 2009 Polish NRA (UKE) identified three Polish mobile operators Plus, Era and Orange as having significant market power (SMP) in the market for wholesale voice call termination on individual mobile networks and imposed remedies on them, including price control. According to this obligation, mobile termination rates (MTRs) are set by UKE on a yearly basis, based on the (actual) costs incurred by the operators. In 2008 UKE identified another MNO, P4, as having SMP and imposed regulatory obligations on it, i.e. access, non-discrimination, transparency and non-excessive pricing. In October 2009 the Polish regulator notified to the Commission its draft decision proposing a glide path for P4 towards symmetric rates, to be reached as from 1 January 2014. The Commission invited UKE to revise its price control methodology and the margin allowed for P4 and to set a new glide path which would result in lower MTRs for P4, taking into account the need for it to become efficient over time.

CenterNet, Mobyland and Cyfrowy Polsat have started their commercial activities in the mobile market very recently while Sferia has not yet started its activities in this market. All of these four operators are building their own infrastructure and provide (or plan to provide in the near future) retail services based on commercial agreements for national roaming with one of the incumbent MNOs. The UKE decided to impose MTRs so that new entrants may adopt higher prices instead of the pre-existing undertakings in the market, which should comply with cost-oriented prices. More specifically the four new Polish entrants (CenterNet, Cyfrowy Polsat, Mobyland and Sferia) have a price control obligation not to charge excessive prices. On 6 January 2011, the European Commission issued its standpoint in which it urged UKE to reconsider its approach. It is not the first time the Commission has criticised UKE for its actions regarding termination rates on mobile networks. The Commission advised UKE to assess the level and duration over which new entrants should be able to charge termination rates above those of more established operators. The Commission recommends four years as a reasonable period of time. After this transitional period, the MTRs of all operators should be symmetric and oriented towards the costs of an efficient operator in line with the Termination Rates Recommendation. The Commission urged UKE to impose a cost orientation obligation (cost-based prices) on the new entrants and invited UKE to carefully assess the level and duration of asymmetry of MTRs of the new operators in its forthcoming decisions. As stated in the Termination Rates Recommendation, MTRs of new entrants may be subject to a higher unit cost for a transitional period before reaching the minimum efficient scale.

Return to top 

The Spanish Government rekindles the reform of the Telecommunication Sector
Antonio Creus and Carlos Maldonado
In accordance with its announced intention of transforming and adapting the Telecoms Sector to the EU Telecom Package, the Spanish Government has been taking important steps.  In December 2010, the Ministry of Industry issued a report on the draft Bill on Telecommunications in General which is to the reform of Act 32/2003 of 3 November 2003 (on Telecommunications in General). Two of the diverse proposals are particularly worth mentioning: 

• The amendment of the powers and functioning of the regulatory bodies, and the strengthening of the powers of the Telecommunications Commission (NRA).  In this sense, it is worth noting that the draft Bill provides that the Data Protection Agency shall carry out its activities on the telecommunications market for the purposes of protection and use of personal data.
• The establishment of a more appropriate framework for investment in the deployment of new generation networks, which offer Internet access speeds above 100 Mbits per second.

The Ministry of Industry has also produced a draft Royal Decree on Actions in the area of Radio Spectrum for the Development of the Digital Society (expected to be enacted in March 2011), which will generalise authorisations to operators in order to implement the principles of technological neutrality and service, as well as the resale of radio spectrum, while opening new tendering processes for most of the radio spectrum. By accomplishing these objectives, the spectrum dedicated to mobile communications services is expected to increase by 70%.

Return to top 

Data retention legislation
Johan Tyden, Henrik Nilsson and Joel Wickman
The Swedish government has presented a legislative bill implementing the EU Data Retention Directive 2006/24/EG, to come into force on 1 July 2011. 

On 3 December 2010, the Swedish Government presented a legislative bill to the Riksdag, the Swedish Parliament, seeking to amend the Electronic Communications Act (2003:389) to implement the EU Data Retention Directive 2006/24/EC.

The Directive was to have been implemented by 15 September 2007, or regarding data relating to internet Access, internet telephony and internet e-mail, by 15 March 2009 for Member States such as Sweden which had declared their intention of postponing the application of the Directive to this data.

The ECJ found on 4 February 2010 that Sweden had failed to fulfil its obligations under the Directive (case C-185/09).

A previous Swedish Government had been one of the forces promoting the adoption of the Directive. In the aftermath of the terrorist bombings in Madrid on 25 March 2004, Sweden, the UK, Ireland and France made a joint proposal on 28 April 2004 to the Council of the European Union, suggesting a draft Framework Decision "on the retention of data processed and stored in connection with the provision of publicly available electronic communication services or data on public communications networks for the purpose of prevention, investigation, detection and prosecution of crime and criminal offences including terrorism".

The Data Retention Directive eventually was formally adopted on 15 March 2006.  In the September 2006 national election, the Social Democratic government was voted out and replaced by an alliance led by the centre-right Moderate Party. One factor generally perceived to have contributed to the changing of political fortune was the widespread negative public reaction to a series of surveillance and anti-online piracy laws passed by the Government.

The issue of online surveillance continued to be very sensitive, and despite pressure from the European Commission the Moderate Party-led coalition, has held off implementing the Data Retention Directive until it had won re-election in September 2010.

In addition to the categories of data to be retained in accordance with Article 5 of the Directive, the bill proposes to add the requirement to retain data regarding failed calls and regarding the localisation of mobile communication equipment at the time of the ending of the communication.

The retention period is set at six months from the day the communication ended.

The Government estimates the cost of adapting telecom operators' systems and operating the storage to MSEK 200 (approx M€22.4). This cost will be carried by the operators, who will not receive any special compensation for this.  The cost for retrieving the data upon request from authorised law enforcement authorities is estimated at MSEK 20 (approx M€2.2) on an annual basis.  The retrieval costs will be charged to the requesting authority in accordance with regulations which will be issued by the PTS, the Swedish NRA. Retrieval requests are expected to increase from the approx 9,000 cases per year now to approx 10,000 per year. Present retrieval requests are charged at SEK 1,500 – 2,000 per case.

PTS has invited the telecom operators to a meeting on 26 January 2010 to discuss future detailed regulation on data retention.

2.6 GHz Spectrum
Johan Tyden, Henrik Nilsson and Joel Wickman
Hi3G, the company which operates the mobile telecommunications service "3" in Sweden, has acquired the spectrum in the 2.6 GHz band (2570-2620 MHz TDD), previously owned (but never used) by Intel. The acquisition was cleared by the Swedish Post and Telecom Agency (PTS) on 22 December 2010.

The PTS limited the number of licences available in Sweden and assigned the licences to five applicants (Hi3G, Intel, Tele2, Telenor and TeliaSonera) following an auction in 2008.

Hi3G applied to acquire Intel's frequency space on 9 December 2010. The application was approved by PTS on 22 December 2010. When providing the reasons for its decision, the PTS referred to Chapter 3, Section 23 of the Swedish Electronic Communications Act (2003:389) wherein certain requirements must be satisfied to permit such an acquisition.

Aside from formal requirements for the acquiring company, such an acquisition must not adversely affect competition in the relevant market or lead to a different use of the radio frequencies. In addition, if any special reason occurs the application may be dismissed. PTS concluded that no circumstances existed in the instant case which implied that the transfer would lead to a change in the use of the frequencies or that any special reasons for dismissal were present.

Regarding the issue of competition in the 2.6 GHz band market, Hi3G would receive almost twice as high a frequency volume than its competitors following the acquisition - 70 MHz compared to the competitors with 40 MHz each. Given that the total amount of spectrum an operator could be allocated during the selection procedure was determined to be a maximum of 140 MHz, and the market concentration, with an increase of 20%, was not considerable, the PTS considered that the acquisition would not adversely affect market competition.

How the exact definition of the "market" should be determined was not made clear in the decision. The PTS does not preclude that the market definition could be broader than 2.6 GHz. A possible range could, in view of the conditions for similar services, consist of a frequency band between 1-3 GHz. In the decision, it was pointed out that the frequency allocation subject to the spectrum in this manner was more balanced between the competitors.
 

CableWatch
Johan Tyden, Henrik Nilsson and Joel Wickman
The PTS began offering on a national basis the new internet service "Ledningskollen.se" (translates roughly as "CableWatch.se") in December 2010, to prevent excavation-related damage to communications and power cables. The service co-ordinates information on the geo-whereabouts of cables of some 131 cable owners, primarily telecom network operators, utility companies and cable-TV networks.

It is not uncommon that buried cables are damaged during excavation work. A broken cable often disrupts services related to electricity, water mains, telephony and the internet. Since telecoms and internet traffic cross many borders, the consequences of such a damaged cable may be substantial. Aside from the potential loss and disruption to the community, the party which causes such damage may be required to pay damages.

The PTS first launched the Ledningskollen.se internet service on 7 September 2009 in the city of Uppsala, and then nationally on 1 December 2010.

The web-based service provides anyone with free information about where buried cables are to be located. The information is added by a variety of cable owners connected to the website. On the website's map it is possible highlight a relevant area with one square kilometre accuracy, whereupon the service interprets which cable owners are affected and then sends an automatically generated query to all the relevant parties.

Return to top

Breach notification for public communication service providers: update
Rhys Williams and Adriano Ros
From 25 May 2011, providers of publicly available communication services will need to notify regulatory authorities and users if the provider suffers a security breach affecting personal data.  

These new rules implement the amended E-Privacy Directive, adopted by the European Parliament in 2009.

The Commission had intended to issue guidelines before May 2011, setting common requirements across Member States as to when breaches should be notified and setting out common formats and procedures, as provided for in Article 4(5) of the amended Directive.  These guidelines are important, to avoid providers being faced with multiple, possibly inconsistent, notification requirements, which would greatly add to the time and cost of dealing with security breach notifications.

The Commission has not yet started this process (which will likely take at least one year from when it is started), so it is clear that guidelines will not be ready in time.  Ahead of Commission work in this area, ENISA has started to collate views of relevant stakeholders with a view to developing guidelines and will be chairing a meeting on 24 January in Brussels.

Providers who are interested in attending can find further details here: www.enisa.europa.eu/act/it/data-breach-notificationS/data-breach-notifications-in-europe-2013-the-way-forward

Ofcom allows 2G frequencies to be used for 3G services
Rhys Williams and Adriano Ros
On 6 January 2011, Ofcom announced that, with immediate effect, 2G mobile phone operators can use their licensed 2G spectrum to provide 3G services. Ofcom stated that the move will allow operators to increase mobile broadband speeds, deliver improved in-building coverage and widen mobile broadband coverage in rural areas. This is expected to bring significant benefits to consumers in terms of increased network capacity, higher data speeds and improved network coverage, especially in rural areas and inside buildings. A change to the existing 2G operators' licences was directed by the Government on 20 December 2010 in response to European legislation requiring the liberalisation of 2G spectrums for 3G use.

Ofcom broadcasting code review – commercial references in television and radio programming
Rhys Williams and Adriano Ros
Ofcom has concluded its 2009 and 2010 consultations on the broadcasting code and has issued its final statements relating to commercial references in television programmes (see here:
stakeholders.ofcom.org.uk/consultations/bcrtv2010/statement)
and commercial communications in radio programmes (see here:
stakeholders.ofcom.org.uk/consultations/bcrradio2010/statement).

It is hoped that the new broadcasting code will allow broadcasters to generate new revenue from advertising.

For television programmes, Ofcom has issued revised broadcasting code rules that will come into force on 28 February 2011. The revised code will lift the total prohibition on product placement for certain programmes and revise the programme sponsorship rules in line with the new product placement rules. During the implementation period leading up 28 February 2011, Ofcom will issue a universal visual logo that broadcasters will have to use to signal product placement and may also issue further general guidance.

For radio programmes, Ofcom has introduced, with immediate effect, new provisions into the the broadcasting code to remove the principle that commercial communications (except for spot adverts) must be separated from the editorial content of most radio programmes. To maintain consumer protection the commercial communications must be transparent to the listeners of the programmes and spot adverts must remain separated as they were previously.

Ofcom revised framework for spectrum pricing
Rhys Williams and Adriano Ros
Ofcom has published its conclusion on how, in future, it will use administered incentive pricing (AIP) to set spectrum prices. In its conclusion, Ofcom has set out eight principles and four methodologies that it will use to determine AIP pricing. For further details see the Ofcom publication here:
stakeholders.ofcom.org.uk/consultations/srsp/statement
 

Ofcom consultation on 'procedures for handling broadcasting complaints, investigations and sanctions'
Rhys Williams and Adriano Ros
Ofcom is inviting feedback from stakeholders in response to some proposed new procedures to handle future investigations into and sanctions for breaches of broadcast licences and investigations into fairness and privacy complaints. The deadline for responses is 11 February 2011..

Britain's superfast broadband future
Rhys Williams and Adriano Ros
In December 2010 the Department for Business, Innovation and Skills (BIS) released a publication entitled 'Britain's superfast broadband future', which sets out the UK Government's strategy to deliver its vision for broadband in the UK, which is to "have the best superfast broadband network in Europe by 2015." The publication, which can be found on the BIS website here www.bis.gov.uk/assets/biscore/business-sectors/docs/b/10-1320-britains-superfast-broadband-future, discusses, amongst other things, the key performance indicators for measuring the UK's development of broadband services, the technology options for implementing the Government's vision for broadband and how to encourage private investment to further develop communications technologies.

Return to top

Contact us