Encheiridion

Epictetus, slave and son of a slave woman, born in Hierapolis, Phrygia, in 55 (in the same year St Paul wrote his first Epistle to the Corinthians) and deceased in 135, was, at his time, a much admired stoic philosopher.

Like Socrates, he has not written a single book, and if it was not for his disciple Lucius Flavius Arrianus, posterity would not benefit from the Encheiridion[1] lessons.

Epictetus, in line with the other Greek stoic philosophers, follows as life ideals the principles of tranquillity (apatheia) and peace of mind (ataraxia), that are necessary to fulfil wisdom, which in turn engenders true happiness, and distinguishes the philosopher from the common man (idiotes).

As it is plain to see, this is more or less a roadmap to resignation (since actions are not good or bad, but it is the judgments one makes of actions that causes disturbance) and to an idle type, if any, of “happiness”. For instance, death. It is not bad. What is bad is that one considers death as something bad. That is why, to be happy, we should, according to Epictetus, not endeavour to see that everything happens as we wish, but wish that everything happens as it actually does.

It is also in one’s reach to be invincible, as long as one does not adventure in any competition where winning does not depend on you.

A worthwhile teaching: Whenever someone accuses you of not knowing anything and you do not feel disturbed, that is only then that you commence to be a philosopher (presumably because you master apatheia and ataraxia; not because you are an idiotes).

[1] Translations are included in “Epictetus. The Discourses as reported by Arrian, The Manual and Fragments. Loeb Classical Library, vol. II. 1973.” or “Epictète. Manuel. Paris. Hachette. 1907.”

Mobile Goes Up

Next year, if you are flying onboard an Airbus aircraft there is a good chance that the “no smoking” signs have been already replaced by a “no mobiles” to prevent usage during take-off and landing. In fact, for the first time ever, airline passengers will be allowed to make phone calls from their own mobile during a flight.

Air France is starting next July - after equipment certification is completed by June - a six-month trial (in a single A318 Airbus aircraft), for passengers to call and send emails and text messages, from their own mobile phones, during flights.

OnAir (a joint venture between Airbus and Sita), in cooperation with Tenzing, and Inmarsat are providing the technological and communications support, which involves a pico cell and a cable antena located in the aircraft and call routing via satelite.

CEPT and OnAir have been working together to harmonise national regulations for this service, so that approval is granted by the NRA of the State where the aircraft is registered and recognised by the other regulatory authorities [Decision on the harmonised use of airborne GSM systems in the frequency bands 1710-1785 and 1805-18880 MHz]. OnAir also wants NRA to exempt the service from spectrum licensing, on the grounds that it would not interfere with ground mobile networks.

In the first half of the test period, passengers will be able to use e-mail and text messaging services or sending emails. In the second half, they can use, additionally, voice services. Upon completion of the trial, and taking into consideration customer satisfaction (it is worthwhile mentioning that in a recent Barclaycard Business survey, six out of ten businessman did not want such a service to be introduced) the French company will decide whether to extend this service to the entire fleet.

Other airliners, are reported to follow suit, such as Ryanair (at the end of this year), TAP Air Portugal and Emirates and, according to the latest edition of Airline IT Trends survey, around half of the airlines plan to offer in-flight mobile phone connectivity and internet access by the end of next year.

CHAMPIONS !!!

• Yes. We had to wait until the final play, but it happened. FC Porto (http://www.fcporto.pt/) is again, and deservedly, the Portuguese Superliga Football Champion, after a brilliant 4-1 win over Desportivo das Aves (http://www.cdaves.pt//mensagem.php). Sporting (http://www.sporting.pt/) and Benfica (http://www.slbenfica.pt/), which could have "stolen" Porto's 22nd League title, had that great club lost its final match, ended up 2nd and 3rd respectively.

• Other champions: Former FC Porto coach, Mourinho, led Chelsea (http://www.chelseafc.com) to conquer yesterday the English Cup after defeating 1-0 Cristiano Ronaldo's Manchester United (http://www.manutd.com/), in extra-time, with a fine Didier Drogba's finish. Fernando Meira, Portugal defender and captain of Stuttgart (http://www.vfb-stuttgart.de/de/), boosted that club to win its 5th Bundesliga, after a 2-1 victory over Energie Cottbus (http://www.fcenergie.de/).

• For those of you who might be wondering what does this have to do with telecommunications, lets end this way: Deutsche Telekom has announced last Friday that Bayern Munchen (http://www.fcbayern.t-com.de/) football players, which might end up playing in the UEFA Cup against Benfica (if Benfica fails to qualify for the Champions League), will be wearing shirts with the "T-Home" logo in the next Bundesliga season.

A Night at the Opera

It is often difficult to find the time, between meetings, to stroll around a foreign city, exploring its places of beauty and culture. Last Friday, one of those rare moments surged thanks to the efficient and friendly organisation of the Latvian colleagues.

Within walking distance from the exquisite Art Nouveau buildings of the Russian architect Mikhail Eisenstein (father of the not less famous cineaste Sergei Eisenstein), in Alberta iela and Elizabetes iela – and passing the Museum of Art, the splendorous Orthodox Cathedral and, finally, the Freedom Monument - is to be found the Latvian National Opera House.

Photo: Eisenstein’s work at Strelnieku Iela

This building was first opened in 1863, reconstructed (after a fire) in 1887 and modernized in 1995, following a project by Imants Jakobsons and Juris Gertmanis.

Photo: Latvian National Opera House

There, we assisted to Verdi’s Nabucco[1]. It was a wonderful performance, in particular by the excellent maestro Normunds Vaicis, which filled with enthusiasm the around 900 Opera loving persons attending the event.

While Nabucco was chanting freedom on stage, some spirits were still remembering that, not many years ago, Nabucco had been prohibited in some parts of Europe.

In the exact same night, Georgios Kyriakos Panayiorou (a.k.a. George Michael) shouted loud the F word – Freedom - ending up with that song his first concert in Portugal, because “freedom is the most important thing in the world". Indeed it is.

On-Net and Off-Net Pricing On Asymmetric Telecommunication Networks

Prof. Steffen Hoernig presented his final version of a paper on “On-net and Off-Net Pricing On Asymetric Telecommunications Network”[1] at the 7th ICP-ANACOM Seminar, in 09/05/2007.

It is common that fixed and mobile operators with a relative small number of customers argue their competitors’ high off-net prices are anticompetitive.

Hence, the presented model, shows a large and a small telecommunications network competing in either linear or two-part tariffs, with a focus on the differential between on- and off-net prices.

This paper concludes that:

(a) when the utility of receiving calls is considered, the equilibrium pricing structures will indeed depend on firms’ market shares and larger operators will charge higher off-net prices even without anticompetitive intent. This happens, in Nash equilibrium, because the presence of the call externality gives incentives to the large network to limit off-net calls in order to make the smaller network less attractive;

(b) predatory behavior would be accompanied by even larger on-net / off-net differences, even if access charges are set at cost, because:

(b.1) a positive margin between access charge and access cost, at the smaller network, creates access revenue from incoming calls. Therefore the larger network sets an even higher off-net price to limit the outgoing calls and, consequently, the smaller network’s access revenue;

(b.2) the larger network competes more vigorously using lower on-net prices if competition is in linear tariffs, and lower fixed fees if competition is in two-part tariffs. This is usually accompanied by higher off-net prices.

The distinction, namely for regulatory purposes, of the two types of behavior, if it is to be based on market data, could in principle be done by calibrating market equilibrium models or, if that information is unavailable, international comparisons may help to identify extreme cases.

The debate, such has happened in the presentation of the fist version of this paper, which I also attended in the ITS Conference at O’Porto, in 2005, was lively, especially around the following issues:

(a) what is the most relevant factor, when opting between a predatory strategy vs a collusive or at least a non-predatory) strategy – size of the larger operator or number of operators?

(b) what is the exact definition of predatory pricing? For instance, if a company is selling bellow the efficient cost of its competitor (namely due to economies of scale, of scope or accrued efficiency), can that practice be considered predatory?

(c) how to consider an evolution of the model in order to make it closer to (Portuguese) reality regarding the mobile sector, three operators of different sizes? And what could one, in general terms, foresee in relation to the expectable results?

[1] http://www.anacom.pt/streaming/Estudo8mai07.pdf?categoryId=241362&contentId=481092&field=ATTACHED_FILE

Access to ducts in Portugal: two case studies and a success story

I. Parque das Nações Technical Gallery

Lisbon World Exposition, which took place in 1998, deeply renewed the capital’s eastern area, an industrial area in a decline process since the mid sixties. After a “scorched earth” approach, involving namely the relocation of inhabitants and activities, the demolition of most of the buildings and the ground leveling works (about 3.3 millions m3 of soil were moved) began with the 6.3 Km technical gallery service tunnel construction.

Photo: Source Parque Expo, S.A.

This technical gallery houses several networks, such as fibre-optic telecommunications, electrical, waste collection by suction, drinking water, irrigation, cooling and heating water system[1], which are continuously monitored and subject to strict security and maintenance measures.

Photo Source Parque Expo, S.A.

Presently, at least seven operators pass their cables in the Parque das Nações Technical Gallery, allowing them to compete and offer services in a business and residential area with high income, even when comparing with the rest of Europe.

This Technical Gallery is still considered a unique example at world level and is frequently visited by urban planners that are developing major infrastructures, for instance in the Japan/Korea FIFA World Cup or in the Beijing Olympics.

Other interesting situation, at Parque das Nações, is that buildings or blocks of buildings are provided with rooms for the set up of technical facilities by utilities service providers, including telecommunications service providers, thus reducing opportunity for preemptive moves by certain operators and contributing to reduce the so called “vertical barriers” in the access to end users.

II. The Access to Ducts Reference Offer

A. The Background

Unfortunately, examples such as the Parque das Nações Technical Gallery do not abound in the country, albeit, for instance, some municipalities have already applied, at their level, adaptations of that concept.

Hence, the costs related with excavating holes to layout ducts and cables are an important part of alternative telecommunications operators overall investment, especially in the local loop. Frequently, these costs result in a significant entry barrier for alternative operators, whilst the historic operators, in most cases, have already depreciated, to a large extent, duct related infrastructures and equipment. It is also common that historic operators do not offer any type of access to ducts (or provide access with odd conditions), thus consolidating their advantage in the local loop.

This scenario is increasingly adverse to alternative operators’ business cases, especially when considering that with the deployment of NGN, operators have to reach, with their own infrastructure, the end user nearer his premises.

The recent ERG consultation document on Regulatory Principles of NGA[2] provides a vivid and detailed insight into the above mentioned economics.

In this context, and taking into account:

(i) difficulties of alternative operators in further investing in ducts in certain geographic areas, in an economically efficient manner;

(ii) the need to avoid inefficient infrastructure duplication and to rationalise the global investment of each company, reducing costs;

(iii) operators’ claims related to (a) restrictions to the use of concessionaire’s infrastructures (namely in sub-ducts, pipe and visit chamber space); (b) discriminatory conditions; and (c) excessive prices;

(iv) the need to promote transparency in the access conditions to ducts and associated infrastructures,

ICP-ANACOM determined PTC, in 17/07/04, to present a Reference Offer (RO) for access to ducts and related infrastructure, in consonance with the principles and rules established in the same decision[3], namely transparency, non discrimination and cost orientation.

The main decisions concerning the RO relçated with the "5 P": Prices, Parameters of Quality of Service, Planning, Procedures and Physical Security.

B. Prices

Maximum prices were established by ICP-ANACOM taking into account cost orientation, efficiency, a fair return on the investment of the concessionaire and non discriminatory conditions. According to the applicable regulatory framework, particularly the principle of non-discrimination, PTC shall apply in the scope of the RCAO the conditions applied to other companies of the PT Group, except where a lower price results from the analysis of costs and from the application of the principle of cost orientation, in which case this price shall be applied.

Information on ducts and associated infrastructure shall be provided at an Extranet page, the respective price being cost-orientated[4], notwithstanding its provision in paper format.

The main prices, resulting in a substancial reduction of PTC's proposals are the following:

(a) monthly occupation of space:

(a.1) in sub-duct per Km (€10.6 / km and cm2 in Lisbon and O'Porto; €8.3 / Km and cm2 in the rest of the Country);

(a.2) in duct per km (€9.8 Km in Lisbon and O'Porto; €7.5 / Km and cm2 in the rest of the Country)

(b) assessment of occupation feasibility (base price) - €64.3;

(c) provision of information (in paper) on ducts - €38.2;

(d) removal of cables in ducts and associated infrastructure - €2.9.

C. Planning

ICP-ANACOM determined, in 26/05/06, PTC to accommodate the following aspects, in the creation, maintenance and update of a descriptive database of ducts and associated infrastructure:

(i) The adjustment of information systems for the provision of record information and the ground surveys for the collection of record information shall be performed in parallel and not sequentially;

(ii) Ground work for collection of information shall start in main urban centres;

(iii) On the date the Extranet is made available, PTC shall make available the results of the ground survey for the collection of record information which have been completed by that date, as well as all available record information;

(iv) PTC shall call upon all necessary work teams to ensure that the ground survey for the collection of record information be completed within eighteen months.

D. Parameters for Quality of Service

ICP-ANACOM established the following parameters for Quality Service with associated target levels and penalties for non-compliance.

Table 1: Parameters and Levels for Quality of Service
E. Procedures

The physical access to ducts and associated infrastructure of PTC, for the installation, intervention or withdrawal of cables, or for the performance of any service governed by the RO, shall be carried out by workers of the beneficiary, who may be escorted by representatives of PTC, where deemed appropriate by the latter.

ICP-ANACOM determined in 26/05/06 that PTC shall: (a) establish an accreditation system and (b) publish and keep updated, a list of bodies who have been accredited, in order to promote transparency.

The main procedures regarding duct access are defined in the RO: (a) information request on ducts; (b) occupation feasibility requests (with/without indication of alternative routes); (c) intervention in cables installed in ducts; (d) unblocking ducts; (e) space reservation.

In particular, rules were established regarding (a) the space to be used by the beneficiaries[5], (b) the space reserved for future use by the concessionaire[6] and (c) the space to be reserved for maintenance and repair work[7]. A technical specification manual is published in annex 7 of the R.O[8]

Cleaning and preservation of infrastructures are incumbent upon the concessionaire. Cables shall be identified in permanent manholes with a code enabling the identification of the respective owner.

Where PTC cables are not set in order (such as in the photo below), the beneficiary entity shall inform PTC thereof. PTC must accordingly set its cables in order.

It is worthwhile to refer that the application of the rules and procedures determined by ICP-ANACOM will prevent suboptimal practices regarding technical procedures for the installment, maintenance and removal f cables.

Other important procedure is that PTC must inform beneficiaries of the construction of new ducts two months in advance of notification to the municipality.

F. Physical Security

According to PTC, the provision of information regarding ducts would present serious risks for national security and civil protection, protection of confidentiality of data of communications networks and infringement of copyright applicable to cartographic production.

An Administrative Court rejected, on 05/08/05, PTC’s claims, referring that “In fact, whereas the applicant submits that the obligations imposed, as regards the construction and maintenance of a database providing descriptive information on ducts and associated infrastructures, by promoting the awareness of the design of the network and ducts, opens the door to situations of sabotage, vandalism, terrorism, improper obtaining of information, and compromises safety and public order, the conclusions stated are not supported on any facts.”

The precise location of PC’s network exchanges, which is a more tricky issue than the design of the network, as it affects communications in a more immediate and global way, has already been disclosed by the concessionaire in the scope of the Reference Interconnection Offer, Reference Internet Access Offer and Reference Unbundled Offer.

By decision of 26/05/06[9], it was foreseen that if PTC so desires, may propose ICP-ANACOM in relation to ducts and associated infrastructure deemed critical: (a) its precise and substantiated identification; (b) special conditions of access.

III. Developments

A. The Access to Ducts Reference Offer

A large set of problems were already solved, especially concerning:

(i) Access to critical infrastructure and guarantee of network security;

(ii) Establishment of the “right price”;

(iii) Planning specifications;

(iv) Technical issues (installation, removal, replacement, and maintenance of ducts and cables);

(v) Establishment of adequate quality of service levels.

The first orders of the beneficiaries were placed in August 2006 and, after implementation of the accreditation system started in November 2006, access to ducts is working at full steam.

The accrued transparency helped preventing conflicts between the historic operator and other operators, concerning access to ducts and quality of service levels are generally improving.

B. Legislative Developments

A new regime - Decree-Law no. 68/2005, of 15th March[10] - set rules for construction, management and access (acknowledging particularly the relevance of access to ducts) to infrastructures in the public domain of the State for communications networks.

It is applicable to the State’s direct administration, to public institutes and other legal persons governed by public law with jurisdiction over the public domain of the State, namely over road, rail, airport, inland waterways and port infrastructures, water supply and sanitation infrastructures and gas-transmission and electricity transmission infrastructures, as regards the construction, management and access to infrastructures installed in the public domain of the State, for the storage of electronic communications networks.

The administration of those infrastructures shall be governed by the principle of healthy competition, ensuring free access, under equal conditions, in a transparent and non-discriminatory manner, to all interested operators.

Each administrating entity shall undertake: (a) to maintain an updated infrastructures database; (b) to implement a procedure to respond to information requests submitted by interested operators, comprising up-to-date contact particulars for this purpose; (c) to supply explanatory information, namely with precise indications on location and on the existence of the available capacity in existing infrastructures, where requested, within at the most 45 days.

C. The European Level

The ERG was asked, in 2006, to assist the European Commission in deciding whether or not to propose specific obligations for duct and other facility sharing as part of the review.

IRG recent work suggests that, albeit duct sharing has not been implemented at a wide range:

(i) it is important to lower entry barriers to deploy new infrastructure, namely fiber access;

(ii) the “remedy” to apply should be further discussed (e.g. ducts vs new ducts, telecom ducts vs other ducts);

(iii) It would be beneficial to clarify and strengthen the legal powers of the NRA stemming from art.12 of the Access Directive and art.12 of the Framework Directive.

Other NRA, such as ARCEP are planning to develop studies and or consultations regarding the overall adequacy and eventual modus operandi of an access to ducts policy.


[1] After that, the construction works continued with the 40 km basic sewage network of primary domestic and wastewaters sewers, a domestic waste lift station and two electrical sub-stations with a power capacity of 40MVA each. Finally, the general secondary or surfaced infrastructures were built, whose works used about 286 km of gas, drinking water and irrigation tubes, automatic urban solid waste collection, domestic and waste waters sewers, including 4 domestic waste lift stations, two solid waste collection central units and two irrigation water pumping stations, 50 km of drains, 230 km of medium tension electricity lines, including 90 switching and transforming stations, 120 km of low tension electricity lines, 140 km of street lighting cables, about 120 000 different points of street and entertaining lighting , 300 km of outside tubes for the telecommunication network and 350 m2 of paved roads. (Source: Parque Expo, S.A.)

[2]http://www.erg.eu.int/doc/publications/consult_regprinc_nga/erg_cons_doc_on_reg_princ_of_nga.pdf

[3] http://www.anacom.pt/template12.jsp?categoryId=162883

[4] http://www.anacom.pt/template31.jsp?categoryId=195682

[5] The concessionaire must leave, to be used by the beneficiaries, in each route, a surface corresponding to at least 20% of the internal surface of each duct (or of each tube in the cases where the ducts accommodate several tubes, or of each sub-duct in the cases where the ducts accommodate sub-ducts).

[6] Concessionaire is entitled to reserve space for its own future end use, for one year at the most, in the ducts and associated infrastructure it operates, provided that this reservation is duly grounded based on the guarantee of an appropriate future development of concessionary services.

[7] The replacement of a cable for another cable of an equivalent capacity (or even a higher capacity) may result in the installation either of a larger diameter cable, or of a smaller diameter cable (for example, where optic fibre cables are used). So, the space to be reserved, by PTC, for maintenance and repair work, is only the space that corresponds to the larger diameter cable.

[8]http://ptwholesale.telecom.pt/GSW/PT/Canais/ProdutosServicos/OfertasReferencia/ORAC/ORAC.htm.

[9] http://www.anacom.pt/template31.jsp?categoryId=193403

[10] http://www.anacom.pt/template20.jsp?categoryId=147742&contentId=266825

Spreading the NGN Word

Steve Johnson, Head of the BT 21 Century Global Venture was interviewed today by America's Network, taking this opportunity to underline the rationale behind this venture, e.g. "to take the learning from the UK and package it up in a way" that fits other operators. BT works with them to "implement the transformation, effectively learning from the mistakes made in the UK to help the operators transform more quickly and at lower risk then they could probably do themselves".

The full(y) educating interview is available at http://www.americasnetwork.com/americasnetwork/article/articleDetail.jsp?id=425049

The Art of Travel: Travel Literature and Literature to Travel

You are flying to another meeting and you have done your homework and read all the exciting deliverables and progress reports. You feel tired, but not sleepy.

You may read “The Art of Travel” (Alain de Botton[1]). It crosses today’s traveling with the adventurous journeys of Flaubert, Humboldt, Woodsworth, Van Gogh and Ruskin. It is interesting and inspirational, but far from the more disturbed and vivid travel writings of Jack Kerouac[2] or Ryszard Kapuściński[3].

Want to stay really awake? Let me suggest some authors whose short-stories and tales, likely to be more compatible with your journey, will grow your sensibility to cross cultural nuances, make you laugh, keep you duly oxygenated and less tired on arrival: Giovanni Boccacio[4], Franco Sacchetti[5], Dino Buzzati[6], Francisco de Quevedo[7], Mor Jokai[8], Machado de Assis[9], Millôr Fernandes[10], Witold Gombrowicz[11], Isaac Leib Peretz[12], Alphonse Allais[13], Karel Capek[14] and Arkadi Averchenko[15].

Some of them are being much undeservedly forgotten, so it is next to impossible to find them at the airport shops. It is better that you look up for them in your favorite bookshop.

[1] http://www.alaindebotton.com/

[2] http://www.rooknet.com/beatpage/writers/kerouac.html

[3] http://www.culture.pl/en/culture/artykuly/os_kapuscinski_ryszard

[4] http://www.brown.edu/Departments/Italian_Studies/dweb/boccaccio/index.shtml

[5] http://en.wikipedia.org/wiki/Franco_Sacchetti

[6] http://www.geocities.com/athens/delphi/8892/indexe.html

[7] http://en.wikipedia.org/wiki/Francisco_de_Quevedo

[8] http://en.wikipedia.org/wiki/M%C3%B3r_J%C3%B3kai

[9] http://en.wikipedia.org/wiki/Machado_de_Assis

[10] http://en.wikipedia.org/wiki/Mill%C3%B4r_Fernandes

[11] http://www.culture.pl/en/culture/artykuly/os_gombrowicz_witold

[12] http://www.enotes.com/salem-lit/bontsha-silent

[13] http://en.wikipedia.org/wiki/Alphonse_Allais

[14] http://capek.misto.cz/english/

[15] http://russia.rin.ru/guides_e/5501.html

New World Innovation Center in Portugal

Despite the announced lay off of up to 9.000 people worldwide, Nokia Siemens Networks[1] is further investing 45 million euros in Portugal, in an innovation center (which will employ at the end of this year around 150 Portuguese engineers).

This innovation center which is inaugurated today by the President of the Portuguese Republic, focus on exports related with the implementation of projects in the fields of Technical Communication and Network Management, as well as in research activities (in partnership with the University of Aveiro) related with fiber optics and management platforms.

The “cluster” formed by the highly qualified resources of the University of Aveiro[2], PT Inovação[3] and the Aveiro Telecommunications Institute[4] was pointed out by João Picoito, South West Europe Head of Nokia Siemens Network, as a driver supporting the already 5th Nokia Siemens world innovation center which is located in Portugal. Also, according to 2006 information from the Minister of Economy, Siemens, which started its operations in Portugal in 1905, was one of the German companies (the other was Wolkswagen) where the highest productivity register was associated with their Portuguese production units.

The other Nokia Siemens world innovation centers located in Portugal focus on multimedia communications, optic communications, home entertainment and telecommunications network management.

[1] http://www.nokiasiemensnetworks.com/

[2] http://www.ua.pt/

[3] http://www.ptinovacao.pt/english/index.htm

[4] http://www.it.pt/

“Universal Broadband” in Sweden

PTS has published, on 15/04/2007, a “Proposal for Swedish Broadband Strategy”[1], with a view to define a strategy that aims to increase accessibility to an infrastructure with capacity for broadband transmission so that by 2010 all households and public and business operations are broadband connected.

This strategy focus on three areas (a) objectives and proposed measures in terms of accessibility; (b) the need of a model for equal treatment of operators; (c) open networks, with special incidence on operators’ access to local fibre networks.

The document recognizes that there “important public interests that cannot only be met through the private market and trough the promotion of competition”, such as the availability of a robust and modern IT infrastructure with high transmission capacity throughout the country, and accordingly suggests that the Government should formulate a long-term objective for access to broadband infrastructure – including a set of measures amounting up to SEK 1.135 m (of which SEK 567,5 coming from structural funds and rural development plans) - and strive for broadband to be perceived as a universal service when reviewing the USO Directive.

In fact, as since 31/12/2005 there are, in Sweden, more broadband users than dial-up internet connections, it could be claimed, according to the NRA, that “the majority of consumers” (in the sense referred to in the USO Directive) use broadband.

The Swedish NRA also supports the view that the appropriate model for equal access treatment is based on the functional separation of TeliaSonera (inspired on the BT’s OpenReach approach), including, namely, a complete separation of human resources between wholesale and retail (each side having specific and unrelated target incentives), accompanied by a “Chinese wall” in terms of information flows. In parallel, PTS announced that the conditions of TeliaSonera’s phasing out of infrastructure related with migration to NGN would be subject to future review.

In this framework, noticing that the present legal framework offers only a limited scope to mandate this functional separation, the PTS states that the Swedish government, as the main stakeholder in TeliaSonera, should strive so that the operator voluntarily carries out such separation.

Notwithstanding, PTS is demanding powers to impose openness requirements in order to ensure that broadband networks financed by public funds are open to other service providers and is recommending Municipal authorities to be given responsibility to ensure access to broadband infrastructure and the right to collect related data.

PTS is also recommending that the government takes into account the following guidance when allocating funds: (a) support should only be payable for the rollout of broadband infrastructure in areas that are lacking such access; (b) support should be technologically neutral; (c) infrastructures funded by the government should be open to all service providers.

Other important measure recommended by PTS is that the joint duct planning (currently adopted by municipalities regarding for instance telecoms, heating, road works) – which results in major cost savings – is extended to power companies.

The guidelines of PTS’s strategy seem very much in line with the Best Practice Guidelines for NGN migration that were approved in the 2007 Global Symposium for Regulators[2] and, together, with the foreseen public and private investment, will most likely produce short-term results regarding the deployment of broadband both in urban and rural areas.

The identified strategy also appeals for additional reflection in terms of the discussion regarding the inclusion or not of broadband access as a universal service in the framework of a revised US Directive (especially given the different levels of broadband penetration in the EU – see post of 30/04/2007) as well as of the design of financing model for the universal service net costs.

[1] http://www.pts.se/Archive/Documents/EN/Proposed_broadband_strategy_eng.pdf

[2]http://www.itu.int/ITU-D/treg/Events/Seminars/GSR/GSR07/consultation.html

ITU Reform: An interview with the President of the Management and Budget Group

José Saraiva Mendes (J.S.M.), President of the ITU MBG – Management and Budget Group (and former President of the ITU Council), speaks about his present ITU challenges and of his work leading this group, that aims to create a Commission with the mission to assist the Council in the restructuring of the ITU.

[Interview conducted by Ilda Matos; edited by Ilda Matos and Carlos Costa]

Which work are you presently doing at the ITU?

J.S.M:The ITU has a very complicated budget problem. For many years, the revenues generated from expos and fairs, in conjunction with the resources applied in funds, helped this organisation’s bills, but their decreasing importance, since the nineties, highlighted even more the budgetary problem.

Hence, some measures were needed to solve this situation and in Marrakech, in 2002, the Plenipotenciary Conference determined the Council to analise ITU’s managerial processes with a view to a revision. That is when I came in. It was my task, then as President of the Council, to put in practice the decision to revise ITU’s managerial processes which has a heavy and expensive structure.

How many persons work for the ITU?

J.S.M: In round figures, the ITU has 1.000 workers. The process revision concluded that this structure was over dimensioned, so we designed a financial plan with a view to restructuring the organisation and cutting personnel, paying a compensation to the people who volunteered to join the plan.

Were the proposed cuts essentially related with the personnel?

J.S.M: Essentially. The idea was to maintain ITU’s functions, but with less personnel. In three or four years equilibrium would have been reached. But that was not possible, due to several reasons.

Meanwhile, a new Secretary-General was elected and he wants to make things better. In Antalya, in 2006, it was established that I must help to create a Commission that with the new Secretary-General would continue the restructuring. What I am doing now is to create the Commission, to define how it works, how the meetings should be handled, what is the working methodology, who should participate, etc. All this work is going to be presented to the Council in September and from that moment on the Commission should start its workings.

With the background that you have mentioned, are you optimistic with the future of the Commission?

J.S.M: Not really, unless the Member-States decide to go ahead with the indispensable measures. But, there is an important aspect: The Secretary-General considers this Commission very important, because it can complement, with a series of initiatives, the work of the Council, which meets once a year.

Will the work of the Commission allow the ITU to be financially balanced? How?

J.S.M: The intervention of Portugal with a special commitment since Marrakech contributed to a significant ITU management progress. During my Presidency of the Council, the work which was developed resulted in the introduction of a cost accounting system and of a budgetary model based on results.

But there is still a lot of work to be done to take full benefit of these tools and to revert the situation. The Secretary-General has made efforts to obtain resources from several countries and from the industry, to see if it is possible to balance the budget. He has also proposed the reduction of the number of Directions.

In this context, the role of the Commission will be to verify the managerial rules that are in use and to check whether those fit the ends the targets that are aimed at. The Commission will verify as well the budget execution. Taking into account what was referred, the Commission has to provide recommendations to the Secretary-General.

Is the internal restructuring ITU’s main priority?

J.S.M: Yes. The work that I have been doing has already identified problems and solutions and we have some tools to begin controlling the situation. This work will be continued in the Commission to be created.

Apart the internal restructuring, which is the main priority, what are the main challenges that the ITU is confronted with?

J.S.M: Essentially, the enlargement of its attributions, namely at the level of the role that it is going to have in the Information Society, which is a very complex reality. In this context, the internet management, which is ensured today by a private institute (ICCAN) founded based on the legislation of the USA State of California, should be underlined. There are doubts if this function should not be preferably ensured by a more general institution, such as, for instance, the ITU.

How do you see the articulation of ITU with other entities, outside the United Nations System?

J.S.M: For me, it is useful that there are contacts between these entities, because we are dealing with a complex reality. It is fundamental that the ITU cooperates with other organizations.

Does the existence of structures such as ITU, with high costs, make sense?

J.S.M: there is a very important aspect: It is the ITU that manages the spectrum at world level. This is the major justification for its existence (notwithstanding the approval of standards, the development of projects to reduce the Digital Divide between the developed and the developing countries and the preparation of telecoms expos).That does not mean, given the present balance between the different forces present in the ITU, that the field of intervention of ITU should be restricted to spectrum management. It does not mean either that it should be enlarged.

What future do you foresee for the ITU?

J.S.M: The ITU will have the same future as the United Nations System, which is the only international forum for discussing the real major problems. At the moment, there are no alternatives.

Are you available to continue your work at the ITU from September onwards, when the new Commission starts functioning?

J.S.M: Presently, I am not a candidate. It will depend of the dynamics that is generated.

IRG/ERG People: Cristina Campos

Cristina Campos (participant in the Regulatory Accounting WG) will be moving, at the end of May, to Refer, the Portuguese railways operator, where she will be working in the set up of the cost accounting system.

We all (probably including also the railways regulator) feel sorry that the she has to go, but the memory of brave and inspiring discussions related with the very nature of costs and its impact on regulatory decisions persists, as well as of her good companionship.

Anyway, you will always be able to reach her at camcris@gmail.com or to give her a call.

Interview with the Vice-President of the OECD Information Security and Privacy WP

The digital identity, the future of Internet, spam, the revision of the guidelines for the security of networks and of information systems, which date back to 2002, are some of the issues that are in the agenda of the OECD Information Security and Privacy Working Party. According to Manuel Pedrosa de Barros (M.P.B.), Vice-President of the Working Party (WP), all these issues must be fully analysed in order to ensure that in the Interministerial Conference of 2008 there are conditions to celebrate agreements between the Member-States.

[Interview: conducted by Ilda Matos; edited by Ilda Matos and Carlos Costa]


What kind of work does the OECD Information Security and Privacy WP produce?

M.P.B: The WP has a programme (resulting from contributions of the OECD Member-States and Secretariat) including issues related with security and privacy which have serious impact in terms of cooperation and economical development. As for the issues presently under discussion, one should refer the management of the digital identity, e-authentication, international cooperation in terms of privacy, RFID, malware, spyware, spam, trends associated with security of networks and privacy of information systems and, last but not least, the preparation of the forthcoming Interministerial Conference.

How does the WP function?

M.P.B: The WP meets twice a year, usually in March and October, and is supported by a Permanent Secretariat that also participates in the meetings. The works are directed and boosted by a yearly elected bureau composed by a President and several Vice-Presidents.

Does the validation of the tasks fulfilled by the WP need to be always at Interministerial level?

M.P.B: Not always. There is the Council of Ambassadors, where agreements may be arranged between Member-States. At the WP level, important works are also prepared and subject to declassification to be available to the general public.

What are the main priorities of the WP for this year?

M.P.B: The Interministerial Conference that will take place next year is the fundamental goal. We have to prepare a wide set of issues that are now of increasing importance, especially the digital identity issue (that the conjunction of data, in a virtual framework, used to identify an agent, conferring this agent the capacity to fulfil an array of actions) and the stealing of the digital identity.

Other important issue in the preparation of the Interministerial Conference is the future of the internet, which will gradually be seen as the “Internet of things”, beyond the interpersonal communication and towards a communication supported in devices, controlled by a computing programme, that interact recurring to the internet.

We are also working in the revision of the guidelines for the security of networks and of information systems, which date back to 2002, to see whether those can be considered updated, if new questions arise and what must be specifically reviewed.

Naturally, all this work has to be produced between the meetings of the W.P.

How do you foresee the cooperation between OECD and other international organisations in terms of network security and protection of critical infrastructure?

M.P.B: In general, beyond the participation of OECD Member States in the W.P., there is also the adhesion of experts from the industry, EPIC, Council of Europe, European Union, APEC and others. Regarding the protection of critical infrastructure, the W.P. is developing studies comparing the policies for the development of critical infrastructure protection.

How does Europe compare with the USA and Japan in issues such as network security, critical infrastructure protection and digital identity?

M.P.B: The situation varies, for each of these topics there are different layers where the relative development is variable.

Broadband Business Users – Ireland

ComReg has published today an interesting survey-based report on the trends around broadband usage by companies[1].

Some of the main findings:

(a) By mid-2006, 89% of businesses had access to the Internet (and, of those, 69% had a broadband access) with penetration levels highest among businesses in the Finance, Construction and Services Sectors, whilst Retail and Agriculture have the lowest penetration levels;

(b) Larger companies are more likely to be connected and businesses with between 1 and 9 employees have the lowest uptake of Internet services;

(c) The most common type of internet connection for SME was DSL (52% of the SME had a ADSL access) and, in the case of Corporates, a leased line or ADSL access (33% of Corporates had a dedicated leased line and 29% a ADSL access);

(d) The main reasons for not taking up broadband, especially for smaller businesses, were lack of relevance and lack of availability (albeit perceived lack of availability seemed to be higher than actual unavailability);

(e) The key benefits to those businesses using broadband included increased efficiencies and productivity, as well as time savings;

(f) Levels of switching between broadband suppliers were low among both SMEs (10%) and corporates (4%), since: (f1) the level of satisfaction with current providers is generally considered high; (f2) companies fear they will make a poor choice and that there will be a loss of service; (f3) the switching would consume time in exploring different options and choosing the best;

(g) Usage of voice services such as VoIP is relatively low within SMEs in Ireland.

[1] http://www.comreg.ie/_fileupload/publications/ComReg0723.pdf

Cable Network “Spin Off” in Portugal

PT’s shareholders approved last Friday (with the opposition of the Group’s Union) the “spin off” of PT Multimedia, the legal entity presently owning the cable network, agreeing to a trade of 4 PT Multimédia’s shares for each 25 shares of PT.

This decision, opening the field for a wider competition in the fixed voice telephony, television and broadband markets, is part of a plan to counter the recently failed Sonaecom’s PT takeover proposal. A Sonaecom Board Member has meanwhile referred to the press (“Sol”) that the “spin off” is not enough and that “vertical separation is also necessary as well as equal access to contents”, considering fundamental that both companies have “different commercial strategies and shareholder structures”.

This operation will be, foreseeable, concluded not later than December and, probably, before next October. If at the date of the “spin off” the shareholders participation remains the same as today, both the companies would have thirteen major shareholders in common. Notwithstanding, PT’s President has publicly dismissed, as a “fantasy”, the idea that the reference shareholders of both companies would be common.

As for the workers that are presently connected to both the companies (which, according to a PT’s Workers’ Commission source, round up to 150 in a total of circa 500 PT Multimédia workers), PT’s President stated that each case would be dealt with individually.

In relation to the regulatory outcome, the PT’s President position (conveyed to the “Jornal de Negócios”) is that PT Multimédia’s network, "should not be regulated, nor PT’s network; there can not be regulatory discrimination”.

Meanwhile, the Chairman of ICP-ANACOM (which has no power of approval in this separation) reiterated (in an interview to the “Público”) that an increase in competition is dependent upon the creation of two really separated entities (whose verification is not compatible with overlapping shareholder structures).

ICP-ANACOM’s Chairman has also stated that depending of the “spin off” model to be adopted, the NRA will “study the markets, analyse the situations and draw consequences”, especially in terms of concluding if the resulting companies are continuing to hold significant market power or not.