DIGITAL EUROPEAN CORDLESS TELECOMMUNICATIONS (Advisory opinion)
PRESS RELEASE
The Italian Competition Authority submitted an advisory opinion to Parliament and Government with regards to certain potential obstacles to the effective development of competition in the market of the DECT services. These obstacles derive from the absence of a well-defined regulatory framework regarding access to special frequency bands and, as provided for by European Directive 96/2, the right to use this technology. In perspective, the obstacles to competition in the market for DECT might also affect competition in the market of voice telephony, whose complete liberalisation is provided for by Directive EEC/96/19, starting from January 1st,1998, in consideration of the important application of the DECT technology as likely alternative to the fixed network run by the current single carrier. Furthermore, the DECT technology would result to be cheaper to consumers than other cellular communications systems, and, as such, it might represent a system partially substitutive or complementary to other cellular communications systems.
Moreover, the DECT technology might be used to supply access to the fixed telephony network.
With regards to the DECT technology, the Authority has been informed that Telecom Italia Spa, after a long experimentation, would have started to promote the distribution of a DECT service in the main Italian cities, through its own information services. It is to be noted that Telecom Italia has the legal monopoly over the fixed telephony network (network infrastructures and voice telephony), while Telecom Italia Mobile, which is controlled by the same Group, holds the legal monopoly over the market of the TACS cellular telephony as well as a dominant market share for GSM, which currently constitutes a legal duopoly.
Assuming that Telecom Italia would be really going to introduce the DECT cellular telephony, the entry of the legal monopolist as the first and, to date, single carrier into this market, can hamper, without a defined regulation of access to this service, the future development of competition both in the market of cellular telephony, which is almost liberalised at a Community level by Directive EEC/96/2, and the voice telephony market, whose complete liberalisation is provided for by Directive EEC/96/19, starting from January 1st,1998.
At the present time, the legal conditions which could allow the public carrier to start the distribution of the DECT service are not met. As such, to this end, an extensive interpretation of the Convention stipulated by Sip, the then public carrier, and the Ministry of Post and Telecommunications Services, and approved by Presidential Decree no. 523/1984, which still defines the sector of activity granted in concessionary regime to Telecom, the new single carrier created in 1994 by joining Sip with various firms, cannot be advocated. Nor can be advocated Section 1 of the Conventio, which was stipulated by the Ministry of Post and Telecommunications Services and Telecom Italia in 1994, in order to implement and manage the GSM cellular telephony network. In fact, to the extent in which the above mentioned concession (even though non exclusive) would permit the public carrier or a firm controlled by it to provide the DECT service - whose supply is barred to rivals presently excluded from such a government concession - discriminatory access conditions would be upheld against new operators.
Considering this reason, it seems urgent and essential to introduce a regulation able to allow also new operators to enter, at equal conditions, the digital cellular telephone market.
The Authority deems that the pluralism of carriers in the market of the new services associated to the DECT technology, in addition to ensure immediate advantages to consumers in terms of price, quality and range of cellular telephony services, can, in the future, contributes to establish favourable conditions for the development of competition in the market of the voice telephony, so as to foster the universal diffusion of this service. In order to achieve these goals, it is necessary to avoid that the development of competition be hampered by the strengthening and widening of the dominant position of the current public carrier to these new markets.
The Authority therefore considers it urgent that the necessary measures are taken to introduce rapidly open, transparent and non-discriminatory procedures which permit new operators to use the frequency bands reserved to the DECT technology and to offer its applications to consumers, on the basis of an authorisation regulatory scheme.
Lastly, the Authority deems it necessary that the obligation of accounting separation between fixed and cellular telephony services is provided for, as well as regulations and procedures are introduced, in such a way as to guarantee the interconnection to the fixed network and among cellular communications systems, on the basis of objectives and non-discriminatory conditions.