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Mobile Marketing Forum 08

Global mobile penetration hits 50%

Figures released by industry analyst Informa Telecoms & Media reveal that worldwide mobile penetration will hit 50 per cent - or around 3.3 billion subscriptions - today, just over 26 years since the first cellular network was launched.

Since its birth in 1981, when the first mobile telephony networks were switched on in Saudi Arabia and Scandinavia, the now ubiquitous mobile phone has become one of the world’s great success stories.

As of the end of September there were operational networks in 224 countries around the globe, a figure that has increased from 192 in 1997 and 35 in 1987.

Informa estimates that mobile networks covered 90 per cent of the global population by mid-2007. This means that some 40 per cent of the world’s inhabitants are covered by a network, but not connected, and leaves just 10 per cent with neither coverage nor connection.

Although global mobile penetration - the number of mobile subscriptions worldwide - has reached 50 per cent, this does not mean that half of the 6.6 billion or so people in the world now have a mobile phone.

A large number of more mature markets worldwide already have in excess of 100 per cent mobile penetration, as users increasingly sign up for more than one subscription, while emerging markets increasingly provide the bulk of new additions.

As of the end of September, 59 countries had mobile penetration of over 100 per cent, while almost half that figure, 27, had penetration under 10 per cent.

The economic difference between the more mature markets and those in developing countries is highlighted by the vast differences in operator ARPU (Average Revenue per User).

Kuwaiti operator MTC brings in the highest ARPU in the world at the equivalent of $71 per month. But it is followed closely by Hutchison Whampoa’s 3 UK operation with an ARPU of $70.55 and Qatar operator Q-Tel with $69. Japanese operator KDDI brings in $67.65 per user per month, while Hutchison’s Austrian operation records and ARPU of $66.84.

But at the other end of the scale, Hutchison’s Sri Lankan operator only counts revenues of $2.83 per user per month, beaten narrowly by Bangladesh’s PBTL, which operates under the CityCell brand and has an ARPU of $2.98. Ukrainian operator Astelit counts user revenues of $3, as does Pakistan’s CMPak, while another Bangladeshi operator, Sheba Telecom, reports an ARPU of $3.1.

Here’s a look back over the past 26 years of mobile telephony:

The evolution of the mobile handset

Mobile penetration through history

No. of mobile networks worldwide

Year (end) No. of countries with networks
1982     6
1987     35
1992     97
1997     192
2002     215
2007 (Sept.)     224

Source: Informa Telecoms & Media

The challenge now is connecting the bottom of the pyramid:
Reaching the bottom of the pyramid

Shoogle sloshes onto phones

Boffins at the University of Glasgow, Scotland, have come up with a novel way for mobile phone users to interact with their phone.
The Shoogle interface [apparently named after a Scots-English word for shake, although the dictionary reckons it’s more likely to be ‘shoggle’], uses a “vibrotactile display and realistic impact sonification” to tell users what’s ‘inside’ their phone.

With the interface tapping into a phone’s accelerometers, a user can tell how much battery life is left by shaking the device and listening to how much liquid is sloshing around inside. Alternatively, they could see how many unread emails or text messages they have by listening to the number of steel balls rattling around inside. These demo sounds could be replaced with pretty much anything.

John Williamson, inventor of the interface and research assistant at the Department of Computing Science, University of Glasgow, has a page on Shoogle here.

Verizon makes a U turn on open access

US mobile operator Verizon Wireless was the company which took the Federal Communications Commission to court over the open access provisions in the 700MHz auction rules, alleging that they were, “arbitrary and capricious, unsupported by substantial evidence and otherwise contrary to law.”

The open access conditions of the auction mean that companies acquiring the spectrum will have to let customers use any device of their choice on the network, and download and access any application, provided they meet certain requirements.

Now it seems the carrier has changed its mind. Today, Verizon said that it will allow customers to use any wireless device, software and applications, even those not offered by the company itself, on its network by the end of 2008. Early next year, it will publish the technical standards developers will need to design products to interface with the Verizon network. Any device that meets the minimum technical standard will be activated on the network.

Clock is ticking on UK broadband

BT, Virgin Media, BSkyB, Vodafone and Carphone Warehouse are among the UK’s telecoms companies meeting with Minister for Competition, Stephen Timms, at a UK broadband summit today. The aim of the get together is to address investment in broadband infrastructure. Although more than half of UK homes have broadband, many other European operators are upgrading their networks to cope with faster speeds, putting the UK in danger of slipping into the internet ’slow lane’.

BT’s offerings are topping out at about 25Mbps at present and the company is running hot and cold on the fibre question, while Virgin is charging ahead with its own 50Mbps cable trials. Even so, other European incumbents are already moving onto networks capable of 100Mbps in the case of France Telecom, and 50Mbps in the case of Deutsche Telekom. Although the German carrier’s objections about not being able to have a regulatory holiday are probably representative of every incumbent in the industry.

There was an interesting development for national UK 3.5GHz licensee UK Broadband as well today. Ofcom has allowed it to connect to mobile devices as well as granting techical neutrality on its spectrum licence - this effectively gives the company carte blanche to start a Mobile WiMAX rollout.

Back to the future

With December almost upon us and Thanksgiving taking place in the US, you can already feel the telecoms industry settling down to hibernate until January. With not an awful lot else going on Amazon managed to grab good coverage for the launch of its Kindle electronic book thingy.

Given the science fiction heritage of the electronic book, reactions were mixed. Some, like Dean Bubley at Disruptive Analysis, were unconvinced, although the device did sell out within hours of launch. But one of the most interesting concepts is that the Web 2.0 powers of the Kindle book will kick start a whole ‘Book 2.0′ movement. Just think - authors will be able to update their works dynamically, readers might even be able to contribute to the story - it would be a book wiki, powered by user generated content.

Meanwhile, Ericsson was probably glad of all the Kindle hype, taking some of the spotlight off the warning that its fourth quarter results were likely to be at the lower end of guidance. Ovum analyst, Martin Garner, notes the fear of a recession in developed markets that could eventually mean, for vendors like Ericsson, that higher margin network upgrade projects would slip, or face cancellation.

Apple and T-Mobile Germany were probably trying to stay out of the limelight this week as well, after Vodafone Germany won an injunction forcing the companies to sell an unlocked version of the iPhone.

Their darkest hour

Black clouds were thick on the horizon this week, as a certain manager looked on in horror, watching helplessly as the universe conspired against him and his team. Yep, it was Ericsson’s annual investors’ conference in New York and while England was mourning its darkest hour since losing the World Cup qualifier to Holland in ‘93, the Swedish kit vendor was mourning its darkest hour since announcing its Q3 financials last month.

Ericsson’s newly installed chief finance officer, Hans Vestberg, had something of a baptism of fire at the investors’ meeting, revealing yet more doom and gloom for the Swedish firm. The crux of the message was that fourth quarter revenues and profits would likely come in at the lower end of expectations as poor market conditions prevail.

Various newspapers reported that another 11 per cent was wiped off Ericsson’s market value on the back of the news and the Informer can’t help but wonder that Karl-Henrik Sundstrom, the previous CFO who quit Ericsson last month, knows exactly how Steve McClaren feels. And he’s probably gutted that he didn’t hold on for a few weeks longer, when he would probably have been given the boot and a whacking great payout as well.

In what might be referred to as the ‘understatement of the year’, Ericsson’s president and CEO, Carl-Henric Svanberg, uttered: “There are slightly more worrying signs than encouraging signs.”

Which is exactly what the PR chap for Ericsson’s handset joint venture with Sony said, as he pointed to the gathering storm clouds atop Table Mountain, Cape Town. Yes this week, the Informer has been attending the AfricaCom conference in South Africa and it’s been glorious weather. Or it was Sunday through Tuesday and again on Thursday when he flew back to Blighty, but on Wednesday night Sony Ericsson had plans to host a party on the top of Table Mountain to watch the sun go down. However, that was the one day it was chucking it down with rain and blowing a gale, while the top of the mountain was hidden from view by some of the biggest, nastiest, storm clouds ever seen in Africa.

It never rains but it pours, doesn’t it?

As it happens, Africa was hogging the telecoms headlines even before the conference kicked off mid-week, as the World Radiocommunication Conference, which took place in Geneva, wrapped up with the adoption of an international treaty to increase the spectrum available for mobile broadband services.

The International Telecommunication Union adopted a proposal led by African Governments to identify a swathe of UHF spectrum for the provision of mobile broadband services in developing countries and rural areas of the developed world. Now that the rest of the world is on board with the idea, industry watchers are calling the move an important step towards closing the digital divide between those with access to broadband and those without.

This was a central theme of the conference but Stephane Boyera of the W3C Mobile Web Initiative raised a valid and interesting point during his keynote - arguing a vision for the mobile web in Africa and other developing countries that should work on the lowest level phones and on a GSM network.

“I personally don’t think that people in rural areas would pay to access the web like the one we are ‘consuming’ for entertainment, for pleasure, for networking, because of the cost that would be considered as wasted. However, if the point is to access content and services that help them, then this is no more a cost, this is an investment,” Boyera said.

All well and good but as any infrastructure vendor knows all too well, that’s not where the margins are. However, taking a part complimentary and part contradictory stance to this view at the event, the GSM Association announced that the mobile industry plans to invest more than $50bn in sub-Saharan Africa over the next five years to provide more than 90 per cent of the population with mobile coverage.

The investment will be used not only to extend the reach of GSM mobile networks but to enhance them with GPRS, EDGE and HSPA technologies and “provide a rich suite of mobile multimedia services, including internet access”.

While, taking an even more contradictory stance was pan-African carrier MTN, which announced that it had signed kit vendor Redline Communications to build a 12 city WiMAX network in Cameroon. A fitting place for MTN’s first WiMAX deployment as Cameroon is where the ITU Working Party 8F convened in January of this year to establish a timetable to recognise WiMAX as an IMT-2000 technology.

Making mobile services more affordable meanwhile, was another pan-African operator, Celtel International, which extended the reach of the ‘borderless’ One Network, giving almost half of the continent’s population the ability to make calls at local rates across 12 countries.

Celtel extended what is known as the borderless mobile network, to Burkina Faso, Chad, Malawi, Niger, Nigeria and Sudan, joining the Republic of Congo, the Democratic Republic of Congo, Gabon, Kenya, Tanzania and Uganda, which were part of the initial launch of the One Network in September 2006.

And from the most unconnected continent on Earth to the most super connected - interweb book shop Amazon has gone back to future and is seeking to rekindle an interest in the electronic book, with an ugly retro looking device called ‘Kindle’.

The interesting thing about Kindle, which is basically a big, expensive ($399), internet terminal with a big screen and some ebook software, is that it has an always on connection to Sprint Nextel’s EV-DO 3G network so users can download new content anytime, anywhere.

The cool thing is, the thing works out of the box with no subscription model. A typical best seller or new release will cost around $9.99 and should be downloaded in less than a minute with no additional data charges, Amazon claims.

On the face of it, it looks like Amazon has followed in the footsteps of the BBC and is covering the cost of the access itself - the BBC has made its content available for free at wifi hotpots in the UK - but then you realise the company will charge you $0.10 a pop to send your own files to the device and another subscription fee for stuff like blog updates, which are free anyway. At this point, the wheels pretty much fall off the model and the electronic book concept goes back to the ’50s from whence it came. Who reads 200 books at once anyway?

Finally, what would a week be without an Apple iPhone story? Peaceful, the Informer would imagine, a state of mind far from the reach of Steve Jobs this week, as his personal Zen was shattered by the brick of Vodafone’s legal team.

Germany’s exclusive iPhone carrier, T-Mobile, has been forced to sell unlocked Apple iPhones after Vodafone Germany won an injunction based on a German law, which states that ‘exclusive’ products tied to another product or service - such as a mobile contract - must also be made available on a standalone basis.

The situation is very similar to the one that Apple has already encountered in France, where the iPhone launches on Orange later this month. And it looks like these pesky competition laws are going to crop up in more European countries, such as Finland and Italy, where Apple might be thinking of selling its wares.

Nevertheless, Germany is unlikely to spawn a healthy grey market in unlocked iPhones as T-Mobile is flogging the thing for the princely sum of Eur999 without a subscription. Achtung baby!

So with Vodafone raining on Apple’s parade and the Informer down on terra firma once again, we’re all back to where we started. The jet lag’s kicking in, the gin and tonic’s wearing off and the rain is coming down, time to wrap up and wrap it up for this week.

Amazon Kindles wireless ebook

It’s not really a core telecoms story, but Amazon’s launch of the Kindle wireless ebook this week is interesting nonetheless. On the surface, the whole ’subscription free’ model looks like a winner - it works right out of the box and the user only pays for what they use. This element is also interesting for a second reason, and that’s because it rolls the cost of the delivery in with the cost of the product. Essentially, the content provider pays the carrier the transfer costs. Which is really the way it should be.

Some people say that this model is where the carrier becomes a dumb pipe and goes against the whole controlling the value chain strategy, but in reality, this is more like a ’smart pipe’ model. In this case, Sprint is connecting the end user with the content he or she wants, and is getting a cut of the revenue stream, without interfering and taking over the whole chain.

Unfortunately, once you realise that there is a subscription model if you want access to blog and news etc. then the offer starts to look less attractive. I mean, blogs are free, so how can Amazon charge for them? Because it has to pay the data rates.

All in all, the Kindle model is far from perfect, but it shows the potential of things to come. Over the next couple of years, the market will probably go mobile internet terminal crazy. Nokia’s already got some devices out, Intel and its partners are working on something, and (hopefully) the hardware for Amazon’s Kindle will also evolve.

So at the moment it downloads books. Amazon already sells digital movies and MP3s so why not start offering them via Kindle either on a pay per item or subscription basis? Ok the larger file size is an issue and I can’t help wondering if Sprint’s WiMAX strategy was key to the Amazon deal. If so, Jeff Bezos is probably having to rethink that one now.

And of course, Amazon’s already got a web shop, which Kindle can alrady access, so why not open up the whole shebang and let people buy groceries and beauty products etc. from the device. The form factor of Kindle is not very suited to voice, but in terms of the mobile internet it might just be that its successors have the potential to set off another bomb in the wireless industry, just like Google (might).

The whole Kindle concept seems to have met with mixed reactions, but I quite like it. Obviously it has to overcome the same tangibility problems that CDs did when digital music was introduced - there’s nothing that compares to the ‘feel’ of a real book - but when I think about my tiny London flat, the bookshelf and all the books that live in it, is probably the single biggest piece of furniture. And the books themselves are quite cumbersome to move in large numbers and they seem to keep multiplying. So the idea of a single device which stores hundreds of books at a time is tempting. As it is, I can’t remember the last time I took a CD off the shelf either. Everything’s on the laptop, so I can pipe it out through the stereo or put it on the iPod. That said, even though my music collection is largely digital, I’ve still got all my old CDs.

Can Android succeed?

Well this week was certainly less eventful, and much of the blogosphere continued its analysis of the fallout from some of the previous week’s news.

Naturally, much attention is still being lavished on Google’s Android platform, with Francis Sideco, senior analyst for wireless communication, at analyst iSuppli wondering whether Google’s foray into mobile phones can succeed. Informa’s own Michael Carroll certainly seems to think so.

Moving on from the analysis of Sprint and Clearwire’s parting of ways over WiMAX this week, there was commentary from Michael Paxton, senior analyst with In-Stat, on Sprint’s decision to halt the rollout of its Pivot mobile-phone service, which is being offered through a venture with four US cable TV operators.

Meanwhile, Julie Ask at Jupiter Research considered the User Generated Content goldmine on mobile phones, while colleague Ian Fogg took a look at Palm OS classic/Garnet, which is being launched, officially, for the Nokia tablet range.

Dean Bubley, over at Disruptive Analysis, had some further commentary on his predictions for VoIP subscriber growth over the next five years.

And in the gaming world, Wired has a piece on Id Software’s - of Doom and Quake fame - moves into the mobile space. Interestingly, Id is critical of Apple’s attitude to game developers. I wonder whether the release of the SDK next year and a hopefully more supportive attitude, will change this situation.

Next time he does it, just punch him on the nose

There’s a popular topic among the anti-tech handwringers at the moment: Cyber-bullying. Parents, teachers, politicians - they’re all wailing about the insidious nature of mobile phones and email accounts when they’re in the hands of The Bullies. It never used to be like this, they say.

There have been one or two high profile tragedies involving student suicides after sustained cyber-bullying but, at root, this has nothing to do with technology. Kids will always find new ways to make other kids’ lives miserable, because - by and large - a small but vocal minority of people just aren’t very nice.

But let’s not yearn for yesteryear just yet. The Informer doesn’t know about you, but he’d rather receive (and delete) a text message saying something nasty than get his head stuck down the school toilet as the chain’s pulled - a favoured bully-tool of yore.

Still, it’s good to see that someone’s found a commercial angle on childhood misery, as the below from AdaptiveMobile reveals:

“Studies show that parents will pay a premium for the ability to blacklist individual numbers and block messages from short codes or content providers to prevent such persecution. As long as they guarantee that the mobile service they are offering their customers is safe, monitored and secure; and provide parents with the ability to put controls in place, operators can reduce customer churn and ensure that both parent and child feel protected from cyber-bullying once and for all.”

Perhaps if cyber-bullying were to be effectively blocked by technology, the bullies would just go back to physical abuse. At least we all know where we stand with that.

And if you’re not getting cyber-bullied, you can now buy a service that does it for you, at least in the US. Sensei Inc. - a “pioneer in web-based and mobile solutions that motivate and empower consumers to lead healthier lives” - this week launched a new service that will harass users with messages about what they should be eating and what exercise they should be doing in a bid to “increase the user’s prospects for weight-management success”.

So just as you’re about to pop that donut into your mouth, you might get a text message that says “a moment on the lips, a lifetime on the hips”. Or something. Who knows what will happen when distressed kids, under enough body-image pressure as it is, get hold of this service.

And, just as anti-bullying solutions are great for combating churn, Sensei’s product, it says, is wonderful news for “employers facing rising health care costs and declining productivity due to weight-management issues”.

Well, bully for you.

A mobile phone that nags you and calls you fat. Isn’t that great? The Informer can just imagine the scene: A housewife of middle years sits, shaking, on a chair in the kitchen clutching a large saucepan. The police survey the scene: The remains of a mobile phone are scattered around the room and the woman stares blankly into the middle distance saying: “I just… finally… snapped…”

European carriers were facing their own bullying problems this week, or so perhaps they see it, as Big Viv Reding, the European Commissioner for Information Society and Media, unveiled her new plans for a European Super Regulator - presumably while rubbing her knuckles. Is it a bird? Is it a plane? No, it’s a European Telecom Market Authority, faster than a speeding HSPA network, able to leap tall roaming charges in a single bound, etc.

The unit will task itself with ensuring that its rules and consumer-championing regulations will be upheld across all EU markets. It could even be granted the power to overrule national regulators, which they might not like. On the other hand, it could free them up to operate without fear of unnecessary national government intervention.

Reding proclaimed that dominant telcos, which are, “often still protected by government authorities, remain in control of critical market segments.” She continued:

“This is why new consumer rights, a new dose of competition, an effective system of independent telecoms regulators, new investment into competitive infrastructures and more space for new wireless services are needed to put Europe’s digital economy on track.”

As yet there has been no response from operator lobby groups. But to see what other industry types thought about it all, click here.

The playground spat between Nokia and Qualcomm descended into minor fisticuffs again this week. The big Q scored a minor win in the District Court of The Hague, in the Netherlands. The court dismissed a complaint filed by the Finn that sought to limit Qualcomm’s intellectual property rights. The Dutch court said that Nokia’s complaint was too unspecific - the firm was being vague in The Hague.

Nokia was about to hit back, but the bell went and it was double maths.

The sums were adding up nicely for Vodafone this week, which turned in some decent results. The Big V notched up a profit of £3.3bn for the six months to end September this year, a marked improvement on a loss of £5bn for the same period in 2006. The firm’s emerging market investments served it well, contributing in no small way to revenues for the period of £17bn.

Voda saw revenue growth in Egypt of 33 per cent, while Romania managed 24 per cent, South Africa 19.6 per cent and Turkey 28 per cent.

The flip side was leaner times in Western Europe, where revenue growth overall was just 1.5 per cent. A solid performance in the UK and Spain was offset by declines in Germany and Italy.

Vodafone’s home competitor, O2, had some results of its own out this week and was happily reporting a continued shift to post pay contracts among its customer base. In Q3 this year, O2 herded 115,000 net customers onto its network, taking its user base to just under 18 million. In the same period, prepay users dropped by 44,000. The carrier booked a 9.7 per cent revenue increase for Q3 year on year, and a nine per cent increase in operating income to Eur530m.

At the firm’s German operation, operating profit was up 8.4 per cent. In the Czech Republic, O2 revenues and operating profit were up by 3.4 per cent and 5.2 per cent respectively. The carrier’s Group revenues came in at Eur3.7bn for the third quarter, compared to Eur3.6bn in the same period last year, while operating income remained flat at Eur1bn.

All this helped Spanish parent Telefonica turn in a 38.7 per cent year on year increase in net profit for the third quarter. Net income topped Eur4bn, while consolidated group revenues increased 4.8 per cent to Eur14.2bn.

O2 launched the iPhone in the UK after the Informer had gone home on Friday last week and, while there were plenty of staged photos in the mainstream press, and reports about a few weirdos queuing for 24 hours just to get hold of one, the consensus is that demand was far from feverish, with many of those specially recruited in-store experts left snapping their gum and wondering which club to go to later.

In other handset news, Korean vendor Samsung has launched a phone that it claims is the first to combine HSDPA and TD-SCDMA. It probably is the first, to be fair. The Informer can’t imagine why anyone else would have bothered.

Meanwhile, in Android news, Google’s put together a prize fund of $10m in a bid to persuade developers to get to work on applications for its product. This is turning into something of a modus operandi for Google, which a few weeks ago offered up an identical sum for the first private company to trundle across the surface of the moon taking photographs. Google released an SDK for Android this week.

Tit for tat acquisitions are never far away at the moment, stimulated by just the sort of cross-sector expansion upon which the likes of Google are currently embarked. This week Microsoft splurged $46m on mobile music outfit Musiwave from Openwave Systems.

And, Motorola dug into its wallet this week as well, taking an investment in contactless payment technology firm Vivotech. The size of the investment wasn’t revealed. “Motorola continues to invest in new technologies that enable consumers to expand the value and functionality of the mobile phone,” says Reese Schroeder, managing director, Motorola Ventures. “This investment reflects Motorola’s commitment to building and participating in a world class mobile commerce ecosystem.”

Just don’t expect Moto to get involved in the service side of things - remember the firm’s reaction to Nokia’s Navteq binge?

But there might be fisticuffs on the horizon for Moto too, as corporate raider Carl Icahn increased his holding in the firm to become the third largest stakeholder in the company. In the past, Icahn and Moto CEO Ed Zander have had very public bust ups over the performance of the company, even resorting to using full page ads in the Wall Street Journal to take pot shots at each other. Evidently, the kind of bullying that goes on between grown men in the business world is a whole different ball game.

Right then, who’s a glutton for punishment? Disney, that’s who. Undeterred by the dismal flop of its homeland MVNO strategy, the firm is trying again - this time in Japan. A Disney MVNO will launch on the Softbank network next spring, the two firms revealed this week. They’re sticking with the Disney Mobile brand in a market that is arguably more open to cutesy cartoon character-branded stuff than the US.

And if you wanted further proof that the folks at Disney like nothing more than barking up the wrong tree, there were reports this week that the firm is considering jumping on a peculiarly US business bandwagon and buying a UK football team. Derby County, no less, a club languishing at the bottom of the table, which might be described in the US as the ‘losingest’ team in the Premiership. It would be a tough decision as to whether you should put your money on Disney Mobile or Derby County.

A first look at the EU telecoms review

The Telecoms Reform Package presented by the Commission to the European Parliament in Strasbourg on Tuesday will change the EU Telecoms Rules of 2002. It is expected to become law by the end of 2009.

The proposals are far reaching and court plenty of controversy, not least with plans to create a European Telecom Market Authority, or “super regulator”, from the existing European Network Information Security Agency (ENISA) and the European Regulators Group (ERG). ETMA would be designed to support the Commission and national telecoms regulators in ensuring that market rules and consumer regulation are applied consistently, independently and without protectionism in all 27 EU Member States.

Regulators themselves would also be given new powers in a bid to free them from pressures imposed by local governments. The watchdogs would be encouraged to impose functional separation on incumbent operators in dominant positions, splitting their network and retail units in a similar way to the break up of BT in the UK.

New consumer rights proposed in the package include:

* The right to switch operators within one day; the right to transparent and comparable price information; the possibility to call freephone numbers from abroad; and a single European emergency number - 112.

* More consumer choice through competition, by giving national telecoms regulators the power to impose functional separation for dominant telecom operators.

* More security in communication networks, with new instruments to fight against spam, viruses and other cyber attacks.

* A “New Deal” for radio spectrum, to spur investment into new infrastructures and to ensure “broadband access for everyone”. The switchover from analogue to digital TV will free a substantial amount of radio spectrum to close this digital divide.

* Better regulation in telecoms by deregulating those markets competition is strong. This will allow the Commission and national regulators to focus on the main bottlenecks, such as the broadband market.

* More independent watchdogs to guarantee fair regulation in the interest of consumers. Too often, telecoms regulators are still close to the dominant operator that continues to be partly owned by the national government in many countries. The EU Telecoms Reform plans to strengthen the independence of national telecoms watchdogs from operators and governments alike.

We’ve got plenty of analysis up here and here, but here’s some key comments:

Viviane Reding, European Commissioner for Information Society and Media:
“Dominant telecoms operators, often still protected by government authorities, remain in control of critical market segments, especially of the broadband market. This is why new consumer rights, a new dose of competition, an effective system of independent telecoms regulators, new investment into competitive infrastructures and more space for new wireless services are needed to put Europe’s digital economy on track.”

Jose Manuel Barroso, president of the European Commission:
“Telecoms is a field where our single market can bring about very concrete results for every citizen in terms of more choice and lower prices, whether for mobile phones or for broadband internet connections. At the same time, a single market with 500 million consumers opens new opportunities for telecoms operators - if Europe helps to ensure effective competition and consistent rules of the game.”

Roberto Viola, Chairman of the ERG:
“In the short term the ERG urges the Commission to amend the Decision that set up the ERG in order formally reflect the ERG’s current and potential role in promoting the single market. The ERG is ready to act on the agenda being proposed today by the Commission. There is no need to wait until 2010. The ERG must get on with this essential work right away.”

Matthew Howett, Ovum analyst:
“Will the reforms proposed realise the full potential of the internal market? Only time will tell. Will all of the proposals make it through unchanged? If we consider the style that we have become used to from the Commissioner with first-class negotiation skills, Reding will initially take the most ambitious stance, knowing that after compromising she will get the deal she really wants. This time will be no exception.”

James Allen, principal consultant, Analysys:
“This is a complex set of proposed changes to the Directives which is not straightforward to interpret. The big prize on offer is a better functioning market in each Member State, as well as effective pan-national markets. But it is too early to tell how the game will play out, and whether that prize will ever be unwrapped.”

Alex Brown, telecoms partner and Jenny Block, EU Competition and Regulatory partner, Simmons & Simmons:
“Creating an appropriate mechanism for licensing of pan-European services is long overdue, but the devil will be in the detail and successful implementation may be rather a long time coming. In principle, this should address market fragmentation, lack of consistency and relieve an administrative burden on cross-border service providers.”

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