1. Regulatory Issues Europe and Austria VON 2003 Boston Fall 2003 Telecom Policy Summit 22. September 2003 Richard STASTNY ÖFEG/TELEKOM AUSTRIA, Postbox 147, 1103-Vienna enum:+43 664 420 4100 E-Mail: richard.stastny@oefeg.at richard@stastny.com

2. Richard Stastny2  Before 1980 the Telecom World was bipolar:  the US, with 3000 privately run telecom companies, dominated by AT&T – centered in New York  the rest of the world, an enormous sea of government-owned and government-controlled operating entities, in most case part of the Ministries and Post Offices – centered in Geneva  This came to an end in 1984 with the break-up of AT&T into 8 pieces.  The Geneva "club" still held together - lead by France,  but UK followed somehow the lead of the US, by privatizing BT and establishing a duopoly with C&W (Mercury) and made a business out of exporting deregulation all over the world with OFTEL and its consultants.  the battle went on until the early 1990's, until a compromise was found in Brussels. Deregulation and Privatization

3. Richard Stastny3  For the launch of GSM (to help the European industry to compete against the US and Japan),  and in the context of the "single market" concept,  the EC accepted more competition, larger market, more technology development, more sales, more jobs and more government tax revenues as telecom theology.  This was a concept even France could accede to (at least in other countries ;-)  So deregulation and privatization started in Europe at various speeds, until 1998 when the first set of directives harmonized this within the EU.  The major cornerstones where:  Privatization,  Carrier selection,  Local loop unbundling,  Number Portability,  Asymmetric "de"- regulation of operators with "substantial" market power -> the incumbents,  to achieve competition and lower prices for end-users. Deregulation in Europe

4. Richard Stastny4  Following the liberalization in 1998, competition in European telecommunications markets has driven growth and innovation and the widespread availability of services to the public (EU commercial from the 8 th Report).  The new regulatory framework is intended to provide a coherent, reliable and flexible approach to the regulation of electronic communication networks and services in fast moving markets.  The directives provide a lighter regulatory touch where markets have become more competitive yet ensure that a minimum of services are available to all users at an affordable price and that the basic rights of consumers continue to be protected.  Member states shall apply those measures from 25 July 2003.  http://europa.eu.int/information_society/topics/telecoms/regulatory/new _rf/index_en.htm http://europa.eu.int/information_society/topics/telecoms/regulatory/new _rf/index_en.htm The new EU Directives (March 2002)

5. Richard Stastny5 1.on a common regulatory framework for electronic communications and services (Framework Directive – 2002/21/EC) 2.on access to and interconnection of electronic networks and associated facilities (Access Directive – 2002/19/EC) 3.on the authorisation of electronic communication networks and services (Authorisation Directive – 2002/20/EC) 4.on universal service and users' rights relating to electronic networks and services (Universal Service Directive -2002/22/EC) 5.concerning the processing of personal data and the protection of privacy in the electronic communications sector (Data Protection Directive - 2002/58/EC) 6.on competition in the markets for electronic communications networks and services (Market Directive - 2002/77/EC) – also EEA relevance  plus the Regulation on unbundled access to the local loop (No 2887/2000) – also EEA relevance EEA - European Economic Area 6 Directives

6. Richard Stastny6  Commission guidelines on market analysis and the assessment of significant market power (also EEA)  Commission recommendation on relevant product and service markets susceptible to ex ante regulations in accordance with Directive 2002/21/EC (also EEA) + explanatory memorandum  Commission recommendation on the processing of caller location information in electronic communication networks for the purpose of location-enhanced emergency call services (E112)  For status end of 2002 see:  Eighth Report from the commission on the Implementation of the Telecommunication Regulatory Package (3.12.2002) Guidelines and Recommendations

7. Richard Stastny7  Goals of the New Telecommunications Law (TKG) (July 2003):  Creation of a modern electronic infrastructure on a high standard.  Securing a fair and functional competition through:  offering a broad selection of choice, price and quality for all users,  prevention of distortions and restrictions in competition,  promotion of efficient investment in infrastructure and innovations,  securing an efficient utilization and administration of frequency and numbering resources.  Promotion for the benefit of the citizens of:  area-wide universal service,  simple and cost effective settlement of disputes,  privacy and security,  transparent tariffs and general terms and conditions,  availability and integrity of the public telecommunication networks.  Above measures should be technology neutral  Innovative technologies and upcoming new markets should be regulated only if necessary to avoid distortion of competition and to reach the goals of this law. Austria

8. Richard Stastny8  Major changes to previous law:  new definition of core network/access provider, communication service provider and information service provider,  no license necessary, only notification,  also mobile number portability (in addition to fixed and services),  carrier selection also for non-incumbents, if provider has substantial market power,  new rules for access (e.g. virtual fixed and mobile operators, resale)  new regulation required for numbering (NVO),  and the new market concept:  from 4 markets (fixed, leased lines, interconnect and mobile)  to 18 markets (see next slide),  now also regional markets possible. Major Changes

9. Richard Stastny9 New markets Retail Market Private CustomersBusiness CustomersLeased Lines 1.Access network 2.National/Local 3.International 4.Access network 5.National/Local 6.International 7.Leased Lines Wholesale Market InterconnectionUnbundelingLeased Lines 8.Originating 9.Terminating 10.Transit 11.Subscriber lines 12.Broadband 13.Terminating segment 14.Trunk segment MobileBroadcasting 15.Access and originating 16.Mobile terminating 17.International roaming 18.Broadcasting

10. Richard Stastny10  No clear picture at the moment  People concerned still struggling with the basics of the new TKG and with more important issues  VoIP is not yet in the main focus in Europe  Implementing VoIP in a closed network (NGN) and using the conventional interconnections is no problem, because regulation in principle is technology independent  of course, the conventional interconnections are not technology independent ;-)  The impact of using VoIP on the public Internet is not fully discussed yet  On the other hand, ENUM and the use of numbering resources for ENUM and VoIP is discussed in Austria for some time  This discussion will also influence the new regulation on numbering (NVO) e.g. mobile personal number range for VoIP Impact on VoIP

11. Richard Stastny11  What is a telecommunication service?  Who is providing which service if two people are talking to each other?  the access provider  the core network provider  the communication service provider  the gateway provider  the information service provider  the clearing house, trusted third party, certification authority, …  the end-user  Is there a difference  if the PSTN/ISDN is involved?  if E.164 numbers or URIs or "private" numbering plans are used?  What is public and what is private on the Internet?  What about emergency services and caller ID?  where to route the call to  trusted location information  trusted Caller ID  Is VoIP able to provide a primary line or Universal service? Questions

12. Richard Stastny12 The End Thank you for your attention