Will telecoms bill be published before Xmas?

11 Dec 2006

There is anticipation amongst Ireland’s telecoms industry that a telecoms bill tabling extra powers to the Commission for Communications Regulation (ComReg) will be published before Christmas. This comes on the heels of yet another report pointing to Ireland’s worsening environment for telecoms competition.

According to the latest regulatory scorecard by the European Competitive Telecommunications Association (ECTA), Ireland has slipped from fifth position last year to ninth position this year in terms of competitive telecoms environments.

The report points to patchy implementation across Europe of the European Framework for Telecoms Regulation. The ECTA Scorecard is a detailed measure of how effectively EU Member States and their regulators have liberalised national telecoms markets to open them to competition

The result of this patchwork implementation of the Framework is a stark split in performance: countries at the top of the Scorecard, including the UK (1st), Denmark (2nd) and France (3rd), which have been more pro-active in driving pro-competitive reforms, have seen a wealth of telecoms offers, growth and investment in the sector, and some of the lowest retail prices in Europe.

Meanwhile countries at the bottom of the Scorecard, such as Poland (17th and lowest), Greece (16th) and Germany (15th), have struggled in some areas to provide an environment in which competition can flourish, which has a negative impact on both consumers and businesses in those countries.

A clear message from this year’s results is that the actions of Governments and regulators to create a pro-competitive environment for telecoms have real and tangible results.

In broadband penetration for example, a critical factor in ensuring European competitiveness on a global basis, there is a strong and significant link between measures taken by regulators to create a sustainable ladder of investment for competition and the take-up of broadband. France, the UK, Netherlands, and Denmark, which have acted to ensure that competition can develop, have all exhibited strong growth with penetration rates already well above the EU average of 15pc. Ireland, however, continues to hover below 8pc penetration.

A key finding in the ECTA report was that many regulators lack the power or confidence to fine companies for breach of telecoms competition rules or to block the incumbent from launching services that undermine competition in the market. By contrast, Spain, Portugal and Greece have relatively effective enforcement powers and have used them.

Most regulators have yet to tackle the issue of “discrimination”, one of the key barriers to competitors being able to compete on equal terms with former state-owned incumbents. The UK, Italy and France are considered to have made most progress, with functional separation in place in the UK and under consideration in Italy.

The Association of Licensed Telecom Operators in Ireland (ALTO) said the industry here is anticipating a pre-Christmas arrival of the new Electronic Communications (Miscellaneous Provisions Bill), which will give ComReg powers originally tabled back in 2002 to investigate overcharging and enforce regulatory obligations by threatening to fine companies 10pc of turnover. At present ComReg can only fine errant operators €3,000.

The Bill also proposes to pass the responsibility for the regulation of the function of the IE Doman Registry, which manages the .ie domain name from the Department of Communications into the hands of ComReg.

ALTO chairman Tom Hickey, referring to Ireland’s position at 9th place (down from 5th last year) said the result highlights the link between effective regulation and innovative competitive markets.

“We consistently see the greatest competition in countries where there is an efficient and effective regulator,” Hickey said. “The report highlights the need for increased powers to be given to ComReg. The Minister [for Communications] has promised that these powers will be included in the forthcoming telecoms bill and we look forward to seeing it published before Christmas.

“That is the first step, and then we will need to see ComReg use these new powers effectively to tackle the barriers to competitive markets. These are well documented and primarily relate to access to wholesale products,” said Hickey.

By John Kennedy