Electronic Communications Submission November 2000

November 2000 – A SUBMISSION BY AER TO THE EUROPEAN INSTITUTIONS REGARDING THE PROPOSAL FOR A NEW EU REGULATORY FRAMEWORK FOR ELECTRONIC COMMUNICATIONS

EXECUTIVE SUMMARY

The Association of European Radios (AER) is a Europe wide trade body representing the interests of private commercial radio operators in France, Germany, Greece, Italy, Portugal, The Netherlands, Spain, Sweden and the UK.

AER welcomes the Commission’s proposals to create an EU Regulatory framework for electronic communications and agrees with the horizontal approach of regulating transmission on one hand, and content on the other.

This paper sets out the comments and concerns of AER concerning the new proposals: the draft Directive on a common regulatory framework for electronic communications networks and services and the draft Directive on universal service and users’ rights relating to electronic communications networks and services.

I. Draft Directive on a Common Regulatory Framework For Electronic Communications Networks And Services (Com (2000) 393)

a) Content and Transmission

  • AER agrees with the concept of separating content and transmission regulation. However, in our view, the proposals fail to take fair account of the direct links that exist between content and networks in the case of radio broadcasting.
  • Radio content providers, both private and public, should have guaranteed access to networks in order to ensure the right of citizens to receive “free-to-air” radio services.

b) Management of radio spectrum

  • For AER, spectrum assignment should be based not only on payment but also on the type of service provided. We have stressed on several occasions that a service-based criterion will protect both consumers and the providers of services of general interest such as private radio broadcasters.
  • The Commission needs to detail and clarify in the Directive what are the specific public interests that need to be protected when using auctions and secondary trading of spectrum.

c) Standardisation

  • At European level a digital radio standard is needed to ensure interoperability in the single market. Therefore, we ask for the integration of a new Recital 23 on Digital Radio DAB.
  • In AER’s view, the European Commission should recommend the Eureka 147 DAB system as a common European standard for terrestrial digital radio since it is the only one that has proved to work efficiently in Europe and that can guarantee interoperability within the European radio sector.
  • AER simply asks the European Institutions for the same level of support to radio as that given to other technologies or transmission systems such as GSM, UMTS or DVB.
  • The Commission says that a List of Standards will be published in the Official Journal of the EC. AER agrees with this concept but believes that the criteria for being listed should be specified in the framework Directive.

d) High-level Communications Group

  • AER welcomes the statement that foresees the need for the High-level Communication Group to take into account the views of interested parties. In this context, AER believes it should be consulted as the only association representing European private radios.

II. Draft Directive on Universal Service And User’s Rights Relating To Electronic Communications Networks And Services (Com (2000) 392)

a) Interoperability of radio equipment

  • AER believes that the interoperability of digital radio equipment should be ensured by this Directive. Therefore, Article 1 should be amended accordingly.
  • Furthermore, AER believes that any barriers to free equipment movement across national frontiers should be removed.

b) Must Carry obligations

  • AER agrees with the principle stated in Article 26. However, taking into account that in many countries cable radio does not exist, AER members believe that in principle where rules currently exist on this issue, they should be maintained, in particular in those cases where there is not enough capacity for all operators.
  • In the digital world, AER firmly believes that “Must Carry” obligations should apply also to multiplex operators.

INTRODUCTION

AER participated through a written submission in the debate of the “1999 Communications Review”. Thereafter, we have been following with interest the developments of this debate and have welcomed the proposals presented by the European Commission last July. This paper aims to set out the views of AER on the implications for the private radio sector of the proposed rules for electronic communications markets in the EU.

AER members generally agree with the liberal and open scope of the proposals, and endorse the political objectives underlying the Commission’s proposals. However and despite this preliminary positive opinion, AER has some concerns regarding the proposed new legislative package.

I. DRAFT DIRECTIVE ON A COMMON REGULATORY FRAMEWORK FOR ELECTRONIC COMMUNICATIONS NETWORKS AND SERVICES (COM (2000) 393)

a) Content and Transmission

The Framework Directive concentrates on transmission infrastructures and does not concern itself with content.

AER agrees with the concept of separating content and transmission regulation. In this context, as we said earlier, we endorse the political and regulatory objectives lying behind the Commission’s proposals. In particular we support the promotion of an open and competitive market for electronic services and associated facilities and the development of the internal market and the promotion of the citizens’ interests.

However, and despite what is stated in Recital 7, we believe the proposals fail to take fair account of the direct link that exists between content and networks in the case of radio broadcasting. In our view, the Commission has based its new rules on existing telecommunication regulation, and thus has failed to appreciate the value and importance of the content transmitted through broadcasting networks.

The European Commission has recently published a Communication on “Services of General Interest” where underlines the importance of radio and television for society. No distinction is made between public and private radios. We believe that all radio content providers should have guaranteed access to networks, in order to ensure the right of citizens to receive “free-to-air” radio services.

b) Management of Radio Spectrum

AER shares the view that radio spectrum is an essential input for radio-based electronic communications services and therefore should be allocated and assigned by National Regulatory Authorities (NRAs) according to transparent, non-discriminatory and objective criteria.

Recital 16 states that “it is important that the allocation and assignment of radio spectrum is managed as efficiently as possible, in a manner consistent with the need to balance the requirements of commercial and non-commercial use of radio spectrum”. It continues by saying that “secondary trading of radio spectrum can be an effective means of increasing efficient use of spectrum, as long as there are sufficient safeguards in place to protect the public interest”. Commission’s Communication on Services of General Interest in the European Union (COM (2000) 0580 Final).

AER is much concerned by Recital 16 and Article 8, which develop the proposals for spectrum secondary trading and auctions. The Commission refers for framework conditions to the proposal for a “Decision on a Regulatory Framework for Radio Spectrum Policy in the EC” but, in our view, it clearly fails to clarify what are the specific public interests that need to be protected. This represents a threat for radio broadcasters.

Once again, it seems to us that the Commission tries to transpose telecommunications practices, such as spectrum auctioning on to the broadcasting sector without taking into account the difference between “one-to-one” and “one-to-many” communications and the different role played by operators.

Different mechanisms can be used to assign radio spectrum but for AER, spectrum assignment should be based not only on the payment of fees but also on the type of service provided. We have stressed in several occasions that a service-based criterion will protect both consumers and the providers of services of general interest such as private radio broadcasters.

c) Standardisation

The Eureka 147 system – DAB was developed by a consortium of European operators with EC financial support. The ITU (International Telecommunications Union) and European companies have recommended this system for its technical excellence.

Therefore, for the majority of AER members – although some have expressed concerns due to the lack of spectrum being made available in some countries – it is important that the European Commission recommends DAB as a common European standard for terrestrial digital radio. We are aware that the Commission endorses the principle of technological neutrality and does not want “to pick winners”, but in the case of digital radio, the DAB system is the only one that has proved to work efficiently in Europe.

We ask the Commission to note how important its approval of technologies has been. For example, mobile telephony, the success of GSM has clearly been assured by the Commission’s recommendation of the standard and the same is happening for UMTS.

This also applies to the digital television sector. In Recital 23 the Commission states that “Standardisation should remain primarily a market driven process. However there may still be situations where it is appropriate to require compliance with specified standards at Community level to ensure interoperability in the single market. (…)”. The Commission mentions the example of the standard DVB for digital television.

We are disappointed to see that the Commission remains reluctant to recognise that the Radio community has developed a digital radio transmission system that has also been standardised by the ITU. At European level a digital radio standard is needed to ensure interoperability in the single market.

AER simply asks for radio to have the same level of support as that given to other technologies or transmission systems. Therefore, we ask for the integration of a new Recital 23 on Digital Radio DAB. This would support the creation of a strong investment environment and would help the migration towards digital technology. See AER Submission to the European Institutions regarding the proposal for a “Decision of the European Parliament and of the Council on a Regulatory Framework for Radio Spectrum Policy in the EC” (13/11/2000).

Article 15 is dedicated to standardisation. The Commission says that a List of Standards will be published in the Official Journal of the EC to serve as a basis for encouraging the harmonised provision of electronic communications networks, services and associated facilities.

AER agrees with this concept but believes that the criteria for being listed should be specified in the framework Directive. In our view, standards should be open, non-discriminatory, suitable for interoperability and services interconnection, meeting the principles of universal reach and having been recommended by standardisation bodies such as ITU or ETSI.

These measures already apply to telecommunications standards; therefore, we believe that if other standards meet these criteria, they should also be listed. In our view, Eureka 147 DAB (ETSI Standard EN 300401) should be one of them.

d) High-level Communications Group

AER welcomes the statement that foresees the necessity for the High-level Communication Group to take into account the views of interested parties. In this context, AER believes it merits being consulted as the only association representing European private radios.

II. DRAFT DIRECTIVE “UNIVERSAL SERVICE AND USER’S RIGHTS RELATING TO ELECTRONIC COMMUNICATIONS NETWROKS AND SERVICES” (COM (2000) 392)

a) Interoperability of radio equipment.

In Article 1, the Commission states that one of the aims of this Directive is “to ensure interoperability of consumer digital television equipment”. AER believes that the interoperability of digital radio equipment should be also ensured. Interoperability between analogue FM and digital services or between digital radio services and other services – such as GSM or UMTS – should be guaranteed.

Furthermore, AER believes that any barriers to free equipment movement across national frontiers should be removed. This is an inherent part of radio broadcasting as a universal activity that offers listeners freedom of choice in different countries. Considering that one of the most important radio features is mobility, the use of radio receivers outside the countries where they were purchased should be possible.

b) Must carry obligations

As far as “must carry” obligations are concerned, AER agrees with the principle stated in Article 264. However, and taking into account that in most countries cable radio does not exist, AER members believe that in principle where rules currently exist on this issue, they should be maintained, in particular in those cases where there is not enough capacity for all operators.

Furthermore, in the digital world, AER firmly believe that “must carry” obligations should apply also to multiplex operators. All radio broadcasters, public and private, holding a content licence relevant to a concrete area covered should be able to broadcast their programmes via multiplex facilities.