Document(s): 

telecom_italia_first_inputs_to_dsm_strategy.pdf

Author(s): 

Telecom Italia

Year of publication: 

2015

Telecom Italia welcomes the initiative of the EU Commission and shares the view that the Digital Single Market is a priority target in order to boost innovation, growth and jobs across all sectors of the economy.

To unleash the full potential of the DSM, EU needs a new public policy which can provide the right incentives to maximize investments innovation and dynamism, at the same time better protecting consumers across the whole internet value chain.

The regulatory framework currently in place is clearly outdated and has proved to be unfit to create the best conditions for the needed high investments to flourish. It is therefore necessary to change course of action, envisaging a modern regulatory framework more focused on fostering investments and infrastructure developments than on mere price reductions.

The unsatisfactory performance of the ICT sector is also explained by market fragmentation which prevents EU industry consolidation and frustrates EU carriers from capturing the economies of scale and scope necessary to compete in the global market, bringing out more evident the need for a more favourable approach towards consolidation so as to foster the investments and therefore the competitiveness of the European industry.

Moreover a regulatory playing field is increasingly important in a market where network operators have open interconnected systems and are subject to strict consumer and data protection rules that do not equally apply to other market players (i.e. OTTs) who provide similar services. This situation contributes to a substantial value migration from European telecommunications operators to OTT players and devise manufacturers which are mainly based outside Europe.

EU telecom operators, indeed, currently face a dual compliance regime (due to the coexistence of a horizontal legislation and a sector specific one), further complicated by national laws, supervision and enforcement.

Such a situation is both unfair from a business point of view and confusing for customers.
An overall assessment of both the horizontal Consumer Acquis and the Electronic Communications Regulatory Framework is therefore also required to ensure that the scope of the Consumer law will encompass all digital services, so that consumers are protected in an holistic way, while, in general, sector specific regulation should be avoided or at least maintained with a very limited scope.

Indeed, in the new converged scenario it is key that the same rules apply to all players offering functional equivalent services across the whole Internet value chain, to obtain the same level of protection and trust for consumers.

In other words, regulation should be proportionate and based on the service that is being offered, rather than on the party (Telco or OTT) offering the service.
Furthermore, consumer regulation should be in place irrespective of the funding model of the service, (money or free, rectius funded in exchange for customer data, which are today’s Internet currency). It should also apply irrespective of the origin of the digital service providers, be they established in the EU or outside EU borders. In this regard the technology and neutral approach foreseen in the proposed GDPR should be applied also for the other horizontal regulation.

Telecom Italia agrees with the Commission that in the digital space, privacy and data security are particularly important to build trust and confidence and have a strong impact on the take up of the digital services and economy. In this field, we highlight that a forward looking regulation should properly balance the need for protection of the fundamental right to privacy and the need of not hampering innovation and big data or a data driven economy (e.g. through measures such as pseudonimysation and anonimysation, protecting data subjects’ rights while enabling business to leverage the value of the data they process).

Indeed in the interest of both business and consumers, as a general principle, an even access to innovation should be granted, avoiding that only some players are free to innovate while others, due to strict regulations, miss opportunities for innovation.

Moreover, to grant the same level of protection and trust for consumers, the so called E-privacy Directive which provides specific rules for telecommunication operators but not to providers of Information Society Service should be repealed through the GDPR in order to avoid the distortions in the consumer protection persist possibly until 2020.

A strong and resilient internet is as well essential to trust and can be achieved by including in the proposed NIS Directive all critical digital Internet infrastructures and service platforms, so granting security throughout the entire Internet value chain.
In order to remove restrictions and drive innovation, the current copyright regulation needs to be updated to create harmonized rules at European level and to favour the diffusion of cross border services.

There is also a need for further modernisation and leveling of the playing field in the audiovisual Media Service market in order to guarantee fair competition amongst providers offering the same service.