€600bn is the price tag of the ambitious political broadband objectives put forward by the European Commission in its 2016 gigabit communication. Public funding available can likely not cover more than 10% of this amount. How to incentivize private investors to match the difference? This was the underlying question throughout the 11th two-day Digital Regulation Forum, the leading regulatory conference in Europe for the digital and telecommunication communities, co-organized by Broadband4europe and Barclays bank in London on 28-29 March. For the third consecutive year, ChinaEU took part in this event, hosting a panel discussion to introduce the Chinese approach to digital regulation and give an overview on China’s prolific environment of digital services.
Luigi Gambardella, Chairman of Broadband4europe and President of ChinaEU, delivering the opening speech at the 11th Digital Regulation Forum in London
Luigi Gambardella, Chairman of Broadband4europe and President of ChinaEU, opened the forum with the words of the famous Greek philosopher Socrates, who lived 25 centuries ago. Socrates claimed to be the most intelligent Athenian because he knew that he knew nothing. In the digital industries we are, he said, all like Socrates: the sector is evolving so quickly that we have, less than ever in the past, any certainty on what the future will bring us.
Robert Pepper, Head of Global Connectivity and Technology Policy of Facebook, speaking at the 11th Digital Regulation Forum with Lise Fuhr, Director General of ETNO, Theo Bertram, EMEA Policy Manager of Google, and Jeremy Olivier, Head of Internet Policy of Ofcom
Facebook全球连通性与科技政策主管Robert Pepper在第11届数字监管论坛上发言，同时参加讨论的有ENTO总监 Lise Fuhr、Google欧洲中东非洲区政策经理Theo Bertram、Ofcom互联网政策主管Jeremy Olivier
The Forum brought together experts and policy makers from Europe, the United States and China to share their views and perspectives and confront these with those of the stakeholders of the industry. The main topic was the new European Electronic Communications Code (EECC), currently discussed by the European Parliament. Will these rules promote investment and the Gigabit Society, or, on the contrary, stifle investment and innovation? Opinion diverged. For example, Robert Pepper, Head of Global Connectivity and Technology Policy of Facebook, said that the extension of the EU regulatory framework to over-the-tops (OTTs) using telephone numbers would lead to technical problems and destroy the confidence in the new proposed rules.
The telecom industry is, by its very nature, global. In particular, the announced relaxation of the US regulatory framework applicable to information services will, in comparison, render investment in the EU even less attractive, said Roslyn Layton of the FCC Landing Team for President Trump’s transition team.
Fiber investment and 5G were high on the agenda of the Forum. The pervasive deployment of fiber will allow the deployment of 5G networks, which on its turn will enable a wide range of new services, most of which we can even not yet imagine today.
Investment in fiber is a pre-condition for this innovation cycle to start and succeed. China provides an interesting model in this regard. Digital has been put very high on the agenda by the current political leadership, said Zhao Shuyu, Researcher at the Internet Law Center of the China Academy of ICT, the think tank of the Ministry of Industry and Information technology (MIIT). China’s 13th Five-Year Plan set a mobile broadband subscription rate of 85 per cent by 2020. Home to the world’s largest 4G network and enjoying some of the highest fiber penetration levels, China has now bold plans to accelerate the development of 5G, expected to be commercialized by 2020.
Investors demand political predictability. However, the EU merger control constitutes a major factor of uncertainty. Whereas entry is strongly facilitated through the regulatory framework, exit is made increasingly difficult, since the sector started consolidating. Benno Buehler, Analyst at DG Competition, reminded that mergers can be cleared only if sufficient commitments are proposed to remedy the competition concerns, which result from the elimination by the proposed merger of one of the few competitors in highly concentrated markets. This can involve, like in the Italian Hutchinson-Wind merger, helping the entry of a new operator in the market, said Gabriella Muscolo, Commissioner at AGCM, the Italian Antitrust Authority.
投资者需要政治上的可预测性。但是，欧盟的并购管控构成了不确定性的主要因素。尽管监管框架极大促进了市场进入，但由于行业开始逐渐稳固，市场退出变得日益困难。 欧盟委员会竞争总司分析员Benno Buehler提醒说，在高密度的市场中，来自少数竞争参与者的并购将导致市场竞争减少；只有在承诺了保有市场竞争性的情况下并购才能被批准。意大利反垄断委员会AGCM专员Gabriella Muscolo表示，与意大利Hutchinson-Wind并购案一样，这可能涉及到帮助新的运营商进入市场。
While financial analysts stress the need for consolidation of the mobile communications sector so as to allow sufficient critical mass to move on to the new 5G networks, competition authorities seem still reluctant to consider the efficiencies that can be brought about by in-country mergers.
For this reason, one needs probably to look for new models, said Luigi Gambardella. In particular, the wholesale-only model seems to be promising. Franco Bassanini, President of Open Fiber, explained in detail how Italy is increasingly relying on the wholesale-only model to attain the EU’s gigabit objectives. Bassanini’s full speech can be found here.
Luigi Gambardella说，因此人们可能需要寻找新的模式。特别是纯批发模式似乎较有前景。Open Fiber公司总裁Franco Bassanini详细说明了意大利是如何越来越多地依靠纯批发模式来实现欧盟的千兆位目标。Bassanini的讲话全文可以在这里获得。
A question that was asked to Reinald Krueger, Head of Regulatory Coordination and Markets Unit at DG Connect, is why the proposal for a code falls short of empowering national regulation authorities (NRAs) to impose structural remedies such as legal separation. National competition authorities can impose ownership separation in case of abuse of dominance or as a condition to approve mergers. Why should national telecom regulators not have similar powers? However, Mark Shurmer, Managing Director of Openreach, Ben Wreschner, Head of Network and Economic Regulation at Vodafone Group and John Strand from Strand Consult strongly disagreed, stressing that the national regulators have already very intrusive tools. Krueger stressed that regulatory intervention should be the exception and that NRAs should first consider the least intrusive remedies.
欧盟委员会通信网络、内容及技术总司监管协调与市场部负责人Reinald Krueger接受提问时回答了条例提案中缺乏国家监管机构（NRAs）采取法律分离等结构性补救措施的问题。国家竞争管理机构在滥用支配优势或作为批准兼并条件的情况下，可以实行所有权分置。那么为什么国家电信监管机构就不能具备类似的权力呢？另一方面，Openreach董事总经理Mark Shurmer，Vodafone集团网络与经济监管部门负责人Ben Wreschner，Strand Consult的John Strand并不同意这一看法，他们强调国家监管机构已具备干涉性非常强的工具。 Krueger强调，监管干预应该作为特别手段，NRAs应首先考虑最不具干涉性的补救措施。
5G will require further spectrum. However, Kalpak Gude, President of Dynamic Spectrum Alliance, stressed that if some governments continue to see spectrum auctions as a kind of ATM to take cash out of the mobile sector, the EU will again – as it happened with 4G deployment – be lagging behind. Chris Woolford, Director for International Spectrum policy of OFCOM, the UK regulator, added that contrary to what was the case until now, the spectrum earmarked for 5G already has users in several Member States. Harmonisation of spectrum band will less be a priority, than exchanging best practices and new spectrum management models. For example, dynamic spectrum allocation.
5G将需要更宽的频谱。然而，Dynamic Spectrum Alliance总裁Kalpak Gude则强调，如果政府继续将频谱拍卖视作自动取款机，将现金从移动领域中抽走的话，那么欧盟将再次被甩在后面，就像部署4G网络时那样。英国监管机构OFCOM的国际频谱政策主管Chris Woolford补充说，与迄今为止的情况相反，专用于5G的频谱已经在数个成员国中使用。有关最佳实践和新频谱管理模型的交流将成为比频谱带的协调更为优先的议题。例如，动态频谱分配。
The Forum was nevertheless not only dedicated to supply side aspects. Robert Pepper stressed that demand side policies were likely even more important on the basis of the data from the joint Facebook-Economist intelligence unit initiative, the inclusive Internet index, which allows to compare the relative situation of (nearly) any country in the world with that of others in terms of Internet usage and availability.
然而，此次论坛不只侧重于供应方。Robert Pepper强调，Facebook-Economist联合智力机构发起的inclusive Internet index的数据，通过比较（几乎）世界各国在互联网使用和可用性方面的相关情况显示，需求方的政策可能更为重要。
High on the agenda was also the heated discussion between over the top operators (OTTs) who claim to generate consumer demand for Internet traffic via their innovative services – and the telecom operators –who claim a larger share in the internet revenues based on their investments in costly networks on which the OTT services eventually run. Should the two side comply to the same set of rules and regulations? The European Commission proposes to level the playing field by imposing new regulation on OTTs in the form of additional obligations related to emergency calls and services interoperability. On the other hand, the US telecom regulator – the FCC – is not keen to introduce new rules for its OTTs. This would be in line with China’s light-touch supervision of internet players, especially e-commerce platforms, domestic social media, mobile gaming providers and sharing economy applications, who appear to enjoy a relatively approach, aimed at ensuring innovation. But probably the most important reason behind the proliferation of Chinese Internet applications is the very high level of competition in the sector, which requires companies to continuously come out with new user-oriented innovations.
A case in point is WeChat, invention of the tech giant Tencent, today the most valuable brand in China with a valuation of 106 bn USD. According to Tom Griffiths, Creative Strategy Director at London-based digital marketing agency Qumin, WeChat was able to accumulate a user base of over 800 million people in less than 6 years by winning their trust. Differently from Facebook, only a small proportion of WeChat’s revenue is generated by advertising, making the platform more social and less commercial. WeChat’s business model has become a role model for many of its counterparts in the West.
这方面的一个典型案例是微信，科技巨头腾讯的产品，也是现今中国最有价值的品牌，估值为1,060亿美元。伦敦数字营销机构Qumin的创意战略总监Tom Griffiths说，微信成功赢得了消费者的信任，在过去不到6年的时间内就累积了超过8亿人的用户群。与Facebook不同的是，广告收入仅占微信收入来源的一小部分，这使得平台更加社交化，减少了商业化成分。 微信的商业模式已成为西方许多同行效仿的对象。
Ji Bo, Deputy Dean and Europe Representative of the Cheung Kong Graduate Business School, being interviewed after the panel discussion at the 11th Digital Regulation Forum in London
Ji Bo, Deputy Dean and Europe Representative of the Cheung Kong Graduate Business School, made a point by saying that regulation is often a way to eliminate competition. Answering to a question on the Chinese interpretation of the Western concept of Open Internet, Ji Bo responded that the control of Internet content in China is needed to maintain stability in in such a big country. Precondition for Chinese and foreign companies’ success in the local market is to build a good relationship with the government.
Alfredo Acebal, Vice President for Global Affairs at Huawei, noted that while in the EU and in the US regulators and the industry are fighting against each other, in China there is greater harmonisation thanks to the fact that both players are focused on a common objective, that is improving the end-user experience.
Innovation and user experience enhancement at core goals of the Chinese government regulator, said Claudia Vernotti, Director of ChinaEU. On March 6th China’s three state-owned telecommunications companies announced plans to eliminate domestic roaming fees and offer pricing incentives to small and medium-sized enterprises, to encourage corporate customers to adopt network technologies such as could computing. In order to foster the development of internet society services and sharing economy solutions, the government appears to favor a “regulation-free first, problem-fixing later” approach. We can see this in the case of the bike sharing boom led by Ofo and Mobike – who let users rent and drop bikes wherever they want, using a mobile app to help them locate nearby available bikes – who after almost a year of uncontested growth, are now facing regulations that limit violations such as illegal parking and define liabilities of citizens, governments and service operators.
中欧数字协会主管Claudia Vernotti表示，创新和用户体验的提升是中国政府监管机构的核心目标。2017年 3月6日，中国三大国有电信公司宣布将取消国内漫游费，向中小企业提供定价激励措施，鼓励企业客户采用云计算等网络技术。为了促进互联网社会服务的发展和共享经济解决方案，政府似乎赞成“零管制准入，后期解决问题”的做法。这一点我们可以从在以Ofo和Mobike为代表的共享单身飞速发展的例子中看到。共享单车是用户可通过手机应用程序来随时取用停靠附近的可用自行车的服务。共享单车经过了近一年的无竞争增长之后，现在正面临着限制非法停车等违规行为、明确公民、政府和服务经营者的责任等监管。
Finally, since the forum took place in London, the capital of the United Kingdom, the organiser of this year’s Forum could not escape from putting two extremely topical issues on its agenda: first, the legal separation between BT and Openreach, which was agreed mid-March. Second, Brexit and its consequences for the digital industries. John Strand warned that if the legal separation of BT is smooth and successful, regulators from other Member States will follow OFCOM’s example and also consider legal separation.
Brexit was seen by Kumar Singarajah, Director for Regulatory Affairs & Business Development at Avanti Communications Group, both as a challenge and as an opportunity for the sector. Luigi Gambardella said that Brexit raised the question whether the cooperation bodies of EU regulators – RSPG and BEREC – should remain EU bodies, or whether it would be better to transform them into open, international bodies where the UK regulator could continue playing a key role as today. He added that issues like cybersecurity are global and that major internet jurisdictions should also be involved in the current specialized bodies, aiming at coordination of Member State policies. Gambardella advocated in this regard that ENISA – the EU’s specialised body on Cybersecurity – would be transformed into an international body of which China could become a member.
Avanti通信集团监管事务和业务发展总监Kumar Singarajah认为，英国脱欧既是数字行业的挑战也是机遇。Luigi Gambardella表示，英国脱欧提出了一个问题：欧盟监管机构RSPG和BEREC的合作机构是否应该保留为欧盟机构，还是将其转变为开放的国际性机构，这样英国监管机构可以继续发挥现在的关键作用。他补充说，针对网络安全这样的全球性问题，主要的互联网司法部门也应参与到目前的专门机构中，以协调欧盟成员国的政策。 Gambardella还主张欧盟网络安全专门机构ENISA转变为国际机构，这样中国也可以加入这一组织。