ITC: Future Perspectives in Regulation and Strategy

There is a potential threat from new bottlenecks in the case of access to user and content. In the case of access to user, some forms of access to networks (e.g. Access Directive 2002/19/EC) may need to continue to be regulated in the future to guarantee competition. Regulation in this case can be effective when it helps to avoid the formation of anti-competitive behaviors, such as for example the customer lock-in effect where customers are dependent from a service provider and are unable to migrate to competitors. For example, customers should be able to switch operator and receive ‘unbundled’ services from different players, as noted in OFCOM’s Annual Report 2006/7 (OFCOM, 2007 p. 6). I am of the opinion that regulation should also prevent excessive prices on bottlenecks facility and, if necessary, introduce a charge control mechanism on operators having significant market power.

In the access to content, from one side clients need content via competing networks and, from the other side, service providers need to channel their services via competing content providers. There may be a real threat to competition in cases of low cable penetration, strong pay-tv operator and a high level of vertical integration. In this case, we might argue that more difficulties may result from the application of different regulation (e.g. broadcast and telecom) to converging services; therefore, coordination of frameworks and remedies is critical for a competitive marketplace.

In this transitional period, it can be recommended to manage this change using a flexible approach, balancing continuity and change – holding one foot in the old system while tempting a coalition of resources and intents with potential supporters and partners for the future. I believe that the best option in this transactional period is self-regulation, allowing a ITC fast-changing industry to take responsibility for necessary rules. However, it is also necessary that current regulations that protect innovation, investments and consumer’s choice remain in place.