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| Dysfunctional separation |
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| Friday, 11 July 2008 | |
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Another rearguard action as common sense and consumer interest are forced to give way to incumbent greed. Ready, aim…
Europe’s vested interests in telecom are once more ganging up on reformers led by the redoubtable ICT Commissioner Viviane Reding. The latest casualties, as a new wave of reform hits the buffers of intransigence, are the creation of a pan-EU telecom regulator and the notion that dominant PTOs should be forced to split retail and wholesale arms to create a ‘level playing field’. Chuck in the mobile industry’s ‘walking backwards, slowly’ response to EC attempts to eliminate scalping and gouging – outright and systematic overcharging – from its voice, text and data roaming price structures and an ugly pattern begins to emerge. Let’s trace that ugly pattern back to it source. Most telecom markets, fixed or mobile, remain dominated by ‘national champions’ (‘natchamps’): these are the monopolies, ex-monopolies, quasi-monopolies or cartels that control individual markets in specific countries. Globalisation has seen to it that ownership may have bled, not just from the state sector to the private field but also to new entities across borders: but value-added and corporate tax takes make these companies ‘meaningful’ contributors to the national exchequers in most European states. Any price controls that hit operator profits and, hence, the aforementioned state tax take, would be injurious to government health. This is especially true when the general economy is depressed as at present, and telecom looks like a bright spark compared to the doom and gloom all around it. Maybe, just maybe, governments are tempted to give natchamps an easier ride. This can’t happen, of course. Between governments and the natchamps are the ‘independent' regulators, bestowed with the title of national regulatory agencies or ‘NRAs’. Theoretically transparent, the only reason they won’t be confused with the NRA (National Rifle Association) in the United Sates is that Europe’s telecom NRAs only fire blanks. But the NRA model is shot through with contradictions so far as any independence is concerned. Most are led or driven by former telecom ministry chiefs and staff, then stuffed full with compliance staff brought in from... deep breath and see if you can guess where we are headed here... dominant telcos. So ugly is the resulting pattern that I renounce my support and affection for ETNO, the dominant telco lobby group that is typically staffed by people who understand integrity and the concept of utility, but have been thoroughly hijacked by market-forced madpersons trading on a dominant position. I also renounce my opposition to ETMA, the proposed pan-EU regulator, one that is a regulator ‘too far’ and the one that ‘dare not speak its name’. If the committees of the European Parliament are against it, then ETMA must be a good thing. ETMA may be cast aside at the whim of legislators who are pumped up by their own misguided belief in their own importance. Vested interests mean that a single economic market for advanced mobile services will continue to be plagued by counter-productive cartelist pricing. If Europe can’t clear the ‘functional separation’ hurdle – which no transparent or independent (or intelligent) regulator could possibly oppose – then Viv, the Lioness of Luxemburg, should lock and load. Jim Chalmers |
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