|
|
|
|
Convergence, Competition and Regulation
Campbell Cowie, Christopher T. Marsden
1. Introduction
The broadcasting industry, the telecommunications industry and the image processing part of the computing industry (the Internet/World Wide Web) are rapidly converging towards a single multi-media market in which TV operators supply voice telephony, telecommunications companies supply video images, and where the Internet is delivering both basic voice telephony and moving pictures on a commercial basis. Moreover, this convergence is expected to accelerate over the coming decade. At the same time as this process of convergence, technical and regulatory barriers to entry in both telecommunications and broadcasting markets have been falling, and are likely to continue to do so. Telecommunications markets around the world have been liberalised, following the examples of the United Kingdom 1 and United States 2 in 1984, and basic voice telephony in the EU was officially liberalised in January 1998. In broadcasting, shortage of effective spectrum created perceived barriers to entry. Consequently, specific prior structural regulation was instituted to prevent abuse of monopoly power, integrated in Europe with positive content regulation in the public interest 3 . However, the development of multi- channel service provision and the anticipated use of digital technology have essentially removed the spectrum barrier to entry. As the UK Green Paper on Convergence 4 states: "The presumption that broadcasting and communications should be regulated should therefore in general be reversed." 5
Although each sector in isolation has become more competitive, which might suggest a lesser need for regulatory oversight, the cross-entry of telecommunications and broadcasting firms into each others' markets, whilst ultimately pro-competitive, raises significant and difficult transitional regulatory issues. An example is when networks, with their substantial fixed costs, are used to supply multiple products. Bottleneck facilities are not new in the communications industries, but the transition to digital television and the impending convergence introduces the potential for a new series of bottlenecks 6 . Increased competition in the market for pay-TV services has increased concerns regarding bottleneck facilities among competition authorities and service providers. In addition to providing an informed examination of the concerns within the framework of convergence, we seek to explain the often misunderstood concept of bottleneck facilities, and explore through comparative case studies possibilities for abuse by vertically integrated actors.
The regulatory implications of convergence are both the substantive issues of access to technical services, and the question of institutional design of the regulatory framework. Historically, the commercial separation of telecommunications and television has been mirrored with separate regulatory authorities, but with convergence, the commercial distinctions are being eroded and the rationale for multiple regulation is being questioned. In particular there is a view that the convergence of the markets 'requires' a merger of the sectoral regulators, to form a single communications regulator 7 . The European Commission issued a Green Paper 8 that addressed the issue of the appropriate regulatory structure, consulting with interested parties untilMay 1998 9 .
In this paper we examine the complex issue of regulatory structure in the broadcasting industry as it stands today, and in the broadly defined multi-media market of the near-future, as best as we can envisage it. After a brief survey of national communications regulators, we focus on the questions raised in the EC Green Paper on convergence as to the appropriate regulatory structure in the multi-media industry. We attempt to stand back from the 'turf wars' between threatened regulators that has heavily influenced the debate within the UK 10 , and even from the discussion of the suitability of existing regulatory institutions for multi-media regulation. Rather, we approach the issue from first principles. First, we enquire as to the particular regulatory functions that need to be undertaken in the multi-media market. Secondly, possible synergy between regulatory functions, which might suggest that they should be jointly exercised, are analysed and, finally, we project as to the sort of institutional arrangements which are likely to emerge. We do not offer, however, definite views on institutions: there are we argue, some bad ways to skin the regulatory cat, but there is more than one acceptable way.
2. Bottlenecks
It is appropriate to begin this section with a definition of terminology. When we make reference to a "bottleneck" facility (or technology), we are describing some technology without access to which it would be very difficult for a third party to provide a service to consumers. Where this term differs from the conventional understanding of an essential facility is by-pass of the facility must not be economically viable for the facility to be regarded as essential. We avoid analysis under the so-called Essential Facilities Doctrine 11 , in order that we are not required to discuss the economic viability of by-pass.
Bottleneck facilities are not new to the communication industries and are certainly not new to the television industry. However, what is new is the requirement for regulatory intervention on such a scale to address control of bottlenecks. The traditional approach to regulation in the television sector has often been founded on the need to prevent abuse of ownership of one or more of the bottleneck facilities. A typical vertical decomposition of the television industry reveals the key stages in the supply chain, from the creation of content, to the household reception equipment, and it is within this structure that the key regulatory and competition policy issues can be identified 12 .
Table 1. Vertical decomposition of the TV industry
At each of the key (bottleneck) stages in the supply chain there is typically only one provider within each geographic territory, effectively placing the provider in a gatekeeper position 13 , with third party access to the bottleneck facilities only possible through agreement with the proprietary service provider. Gatekeepers are in a powerful position to disrupt the competitive constraints that would otherwise be present in the market. There are a number of general 14 ways through which competition might be undermined:
In countries reliant on the radio frequency spectrum for the delivery of television signals, the oft- cited "justification" 16 for regulation has been the shortage of effective spectrum capacity, while for those more dependant upon non-terrestrial means of delivery, delivery still remains an important matter, but the bottleneck is not radio frequency spectrum, but either cable capacity of satellite transponder capacity. In conventional (analogue) television industries it the process of delivery that is perceived as the key bottleneck facility. The typical response to the potential problem is government ownership of the facility with access granted under licence 17 . Advances in digital compression technology should make it possible for households to receive many hundreds of digital services, using only a fraction of the valuable spectrum resources that are employed today 18 . Will the transition to digital reduce scarcity in the supply chain and lessen the need of regulatory interference?
The answer is a resounding 'No'. In fact, the introduction of digital television creates new and additional bottleneck problems, some of which we seek to address here. The key difference between analogue and digital in this regard is the location of the bottleneck facilities in the supply chain of production. Traditionally, the fierce competition between the creators of content for scarce retail outlets (channels delivered to the consumer), was the source of market power for those providing delivery services. However, as spectrum restraints diminish, the situation is reversed, with a greater number of retail outlets competing for relatively scarce content. This phenomenon was referred to in the EC Green Paper on Convergence, but with no explanation of dynamics 19 . While this may be true, it does not tell the full story. Market power (in the shape of control of bottleneck facilities) may also move down the supply chain, to the level of household reception equipment. It is the bottleneck facilities at this stage in the supply chain which are the focus of this paper.
Competition authorities are aware of the significance of bottleneck facilities for competition in the digital environment and have demonstrated their desire to prevent the abuse of position by those who control these gateways. Herbert Ungerer of the European Commission Competition Directorate has recently stated:
Convergence is driving infrastructure provision but it is also defining the future bottlenecks.whether the band-width explosion will happen, will entirely depend on the competitive conditions. Convergence can now not mean the creation of new super- monopolies - and this danger is very real. It is the immediate question underlying most current competition cases in the area 20 .
In attempting to demonstrate the complexity of addressing the issues of third party access to bottleneck facilities, we adopt as case studies the regulation of key technical elements of the supply chain, associated with consumer reception equipment. Specifically, the necessary set-top box decoder (formally, the Integrated Receiver-Decoder or IRD) can itself be decomposed into its technical components, Applications Programme Interface (API) and Electronic Navigation Guide (also referred to as navigation software, Electronic Programme Guide (EPG) or Electronic Scheduling Guide (ESG)). We compare these software applications in the set-top box decoder with the ubiquitous Windows operating system and Internet Explorer navigational software in Personal Computers [PCs], with specific reference to recent case law relating to alleged abuse of dominance in important areas of the PC sector. The case law is highly relevant to our discussion, as the technologies subject to legal intervention perform a similar function to the API and EPG and subject to similar competition concerns.
Similarly, the market power is greatly enhanced through the vertical control of the key facilities. In fact, abuse only makes sense where the controller is active at both levels, as in the absence of vertical integration there would be little commercial justification for dissuading entry 21 . The problems of the vertical control of technical facilities is being addressed in the Microsoft case. We are therefore exploring a case study which bears remarkable similarities to the phenomenon of 'Wintelism' 22 . We are conscious that definitional analysis of such 'bottlenecks' carries comparisons with the essential facilities doctrine of United States jurisprudence, and that such comparisons, if injudiciously applied, result in presumptuous regulation of first mover innovators in dynamic high-technology markets 23 . As Overd and Bishop state: "The overzealous application of the essential facilities doctrine has the potential seriously to undermine the incentive for firms to innovate." 24 They criticise the regulation of digital pay-TV conditional access systems by European Union Directive 25 , as an example of essential facilities regulation in practice, leading to a 'chilling effect' on innovation by first movers.
Phillip Areeda 26 has criticised US jurisprudence for extending the concept of competitor access to monopoly bottlenecks in a distribution chain from "an extreme case" until it "ultimately becomes ridiculous": "judging by catchphrase". He saw 1980s US jurisprudence as the expansionary phase. The landmark cases of Terminal Railroad (1912) 27 and Associated Press (1945) 28 provide initial guidelines for European policy-makers. In the former case, a consortium's purchase of an existing railroad essential facility led the Supreme Court to insist on all competitors being granted access. In the latter, which Areeda describes as "a more doubtful case", Associated Press was disbarred from applying non-competition clauses to new membership of its news agency consortium. In the deciding judgment, Frankfurter J. stressed the importance of extending the concept of 'public utility' in the interests of "such access to the function of a free press in our democratic society" 29 . There is thus expressly stated a presumption of access to essential facilities in the interest of media pluralism. MCI v. AT&T (1983) 30 further establishes that public policy of access to communications must not be flouted by a monopolist.
One can identify increasing enthusiasm for the essential facilities doctrine in Europe in the 1990s 31 , culminating in the more generous interpretations put on Magill TV Guide/ITP, BBC and RTE (1989) 32 . The case dealt with RTE (Republic) and BBC (Northern Ireland) public broadcasters' refusal to deal in programming information. They refused to supply programme schedules to an innovatory Magill/ITP product, a combined TV listings magazine for the whole of Ireland, a geographical market in which neither broadcaster published a rival product. The Court upheld the Magill/ITP complaint against the broadcasters. The initial Commission decision in Magill could tenuously be held to apply a general duty to deal in intellectual property essential facilities, extending even to major sports coverage. This stretches the credibility of the doctrinal approach. It is better analysed as a flagrant abuse on the facts from the Court of First Instance analysis (1995) 33 . In the latest assessment of judicial use of essential facilities doctrine in the European context, Ladbroke (1997), Korah has written of her unhappiness with "the failure expressly to limit Magill to extreme cases." 34
This leads to the offering of a valid comment on the application of economic principles to the practice of competition policy. Typically, competition authorities have typically taken a rather "textbook-ish" view on the existence of economic surplus or economic rent 35 . Specifically, all rent is viewed as monopoly rent and is therefore regarded as a result of anti-competitive actions or behaviour. In passing judgement on the possible anti-competitive consequences of the control of bottleneck facilities in high technology sectors, a greater understanding of the concept of economic rents should be demonstrated. Rent may be divided into three categories, where only the first, monopoly rent, may be accurately said to be the result of anti-competitive activity 36 . Rents may accrue due to innovation and risk taking, without which there may be no advancement in the market. Welfare economics suggests that innovation or Schumpetarian rents should be actively encouraged rather than penalised and that care must be taken in the regulatory process so as not to stifle incentives. The third form of rent is due entirely to natural events and may be regarded as a Riccardian rent or a natural monopoly rent. Existence of Riccardian rent cannot be the result of anti-competitive activity and so should not be penalised as though it were, although care must be taken such that the monopolist does not abuse the position.
These problems appear novel in television because of its formerly strict vertical separation and government ownership of bottlenecks, but needless to say the bottleneck issues have always existed 37 . Extension of the essential facilities doctrine raises problems of regulating a dynamic and structurally complex industry, where successful innovation can easily confer monopoly status, which may trigger a competition intervention. We are, however, encouraged by the 1996 Office of Fair Trading investigation of pricing in the UK wholesale market for content 38 , as the conclusion were clearly based on a need to not penalise innovation. We begin our analysis by examining UK regulation of the API and EPG 'bottlenecks'.
3. Technical Bottleneck Facilities
Applications Programme Interface
Where the technical bottleneck facilities have been made subject to regulatory interference, the issue of third party access to conditional access services has been the primary concern. However, some understanding of how digital television reaches the consumer suggests that there are other technical bottleneck facilities that may be equally, if not more, important. This is especially the case for the provision of interactive services. In this section, we focus on the regulatory problems that surround the set-top reception unit (Integrated Receiver Decoder (IRD) or set-top- box).
The IRD may itself be broken down into its component parts, primarily the Applications Programme Interface, the Verification software 39 and the Electronic Navigation System 40 . Consider the IRD. To a rough approximation it may be regarded as a computer. In the vertical description of the computer system architecture, the API rests between the operating system that shields the user from the complexity of the hardware, and the applications (the individual pieces of software that provide the user with services). The API is an operating language that controls the functioning of the terminal. The API defines the software interface that the applications expect to find on the IRD.
Many of the hyped digital TV applications will need to interact with the IRD's API. It is therefore important that service providers are able to use the API in order to deliver their full range of services.
Example Applications
There are several ways by which the controller of the API could obstruct market entry 41 .
In developing the API for the digital TV industry, manufacturers have typically made use of technologies developed for the PC industry 42 . In fact, the origins of the API are found in the PC industry, where Windows is perhaps the best known API. The PC market provides a useful insight into the problems surrounding the API. Technical specifications for the Windows API are well defined and licensed to applications programmers. Retailers are therefore able to stock "Windows compatible" software, confident that it will operate on any Windows-based computer. The importance of API compatibility is well known for the PC market. In Microsoft (1998) 43 , Williams J. analysed the function of the API:
the operating system provides a basic support structure for an application via APIs.Each operating system's APIs are unique; hence applications tend to be written for particular operating systems 44 .
Similarly, if the technical specifications of the IRD API are well defined and made easily available then programmers for applications such as interactive software can operate with the confidence that the application will function on all compatible decoding equipment. It should be noted that there is no requirement to define a formal API. For example, PerfecTV (in Japan) digital services provides just an EPG, and so long as agreement can be reached between the relevant parties on transmission specifications then the IRD from rival manufacturers can quite easily be made to provide services in a uniform way. An API is, however, necessary where the service provider wishes to offer either new applications or an updated version of an installed application. This function may be useful given that, once installed, updated versions of the software and new software applications will be developed and introduced.
Electronic Navigation Software
Similarly, there are clear links between the navigation software to be used on the digital IRD and that found for accessing and browsing the World-Wide-Web (WWW). Navigation software designed for digital television enables consumers to access information on all services that are available to them. The consumer is able to navigate between services without reference to the multiplex that carries them, the EPG thereby concealing the complexity from the viewer. The EPG processes user commands and calls the appropriate file manager to perform the requested function. Although like others, we commonly use EPG as synonymous with navigation software, EPG is only one possible technology. The EPG may be best thought of as a richer system that provides service details for many days in advance, while the term Electronic Services Guide (ESG) describes a far simpler, text based system that provides bare minimum functionality 45 . It is the function of the navigation software to enable the consumer to move easily between services, to review current and near-future services without disrupting current viewing or recording and facilitate the future scheduling of event recording. There are two approaches to the user interface. First, the navigation can be "up/down", where there are sequentially numbered channels within a bouquet or second, a single key selection where consumers will select services by the programming genre rather than by channel location within the bouquet.
From a regulatory perspective control of the EPG is important as it provides a daily opportunity to influence viewing shares. The navigation technology provides for provides for strategic control of the digital TV industry, as they are the first service that confronts the viewer and they inform the consumer of the services that are available. The EPG will be the de facto method by which the consumer will control daily scheduling as well as the means by which service providers will market their content to consumers. As the audience becomes increasingly fragmented across multiple channels the navigation software will become the crucial tool for influencing viewing patterns.
The potential for abuse is obvious given the purpose of the EPG. Consumer selection of programming services may be influenced by the navigation software, and any bias in the listing will have serious implications for content providers.
With respect to Internet navigation software, Williams J. analysed the function of browsers:
.Browsers enable the users to navigate the Web and to access information. Most browsers are designed according to a "multiplatform" approach. Microsoft's Windows 95 licence agreements have required [manufacturers] to accept and install the software package as sent to them by Microsoft, including Internet Explorer, and have prohibited [them] from removing any features or functionality, i.e. capacity to perform functions such as browsing 46
The Department of Justice had previously succeeded in obtaining a temporary stay on such bundling of navigator with API, with the intention of forcing Microsoft to display Netscape's Communicator navigation programme with equal prominence. The success of Microsoft's appeal on 23 June raises the prospect that it wins the full hearing of the appeal in the autumn of 1998. A very similar competition dilemma arises with the digital pay-TV decoder's API and navigation browser, the EPG. In the UK, the API and EPG is designed and licensed by vertically integrated 47 actors, who typically also control proprietary conditional access systems, programming rights and subscriber management systems.
Although there are undoubtedly competition concerns that arise from control of bottleneck facilities on a stand-alone basis, control by vertically integrated service providers of the key facilities yields extra-proportional increases in market power 48 . Consider the route to the consumer. Content suppliers must be able to access all the facilities of the IRD, as a package. It is vertical integration that facilitates the potential for abuse.
4. Regulation as Means of Control
While the issue of third party access to technical facilities was central to the 1995 Advanced Television Services Directive, control of the internal functions of the IRD were largely ignored. There may have been many credible reasons for the exclusion and any guesswork would be mere supposition. Under the 1995 Directive, third party access to conditional access technologies was to be granted on "fair, reasonable and non-discriminatory terms", with responsibility for ensuring this given to Member State legislation. Authority for ensuring that third party access to proprietary conditional access systems within the UK has been awarded to the telecommunications regulator, Oftel. Regulation by Oftel has been justified on the grounds that although conditional access is a television service the technology makes use of existing telecommunications infrastructure and should therefore be regulated as other telecommunications services 49 .
After a lengthy period of industry and public consultation Oftel published provisions that would underline the regulation of access to conditional access services 50 . Oftel demonstrates that regulatory interference should be regarded as a last resort, as intervention will only be triggered where commercial negotiations fails to produce an agreement that is acceptable to Oftel.
We view the approach taken by Oftel to be a sensible one and it may serve as a useful guide to other, similarly position regulatory authorities. Rather then impose some form of price regulation, the UK system is to rely primarily on commercial negotiation. Regulatory intervention will only materialise where there is a failure to achieve an acceptable agreement.
Now to the interpretation of the specific regulatory conditions. "[F]air and reasonable" have been construed as inferring some general equality between the total revenues and the overall costs associated with conditional access services. However, aspects still to be settled include the appropriate method by which any network subsidy can be recovered from third parties. With regards anticipated charges, Oftel has proposed that these should be set somewhere between incremental and stand-alone costs, but some difficulty still arises here as that leaves a broad range of choice, especially as many of the incurred costs are common.
Perhaps even more arduous has been the interpretation of non-discrimination. While it is true that a flat uniform charge for each broadcast service might be non-discriminatory, but it is inefficient in that it ignores the demand conditions. The effect of uniform charging would be that otherwise viable services would fail to survive, as they had insufficient revenue potential. Once again, Oftel has shown a great deal of common sense by enabling price discrimination among three categories of services: free to air, pay TV and interactive services. Although, we believe this to be a sensible approach, until it is tested, we cannot say with certainty how effective the process will be.
It comes as no surprise that Oftel has taken a very broad definitional view of conditional access services. Oftel has claimed the disputed right to regulate all EPGs that are married to a conditional access system, taking the view that the EPG is an integral element of the conditional access system. Although not specific on the details, Oftel will, by regulation, seek to prevent any restriction of competition between broadcasters on the EPG.
The EPG provides an example of a regulatory issue that arguably overlaps the responsibilities of both the ITC and Oftel, as the ITC has published a Code of Conduct for the provision of EPG systems. While the Code is very detailed, the terms of access are very vague, stating only that access must be provided on fair, reasonable and non-discriminatory terms. It is pleasing to see that with regards to the regulation of the EPG, the ITC and Oftel have initiated a joint committee to oversee the regulation, although as the industry develops in the UK it will be of interest to see which regulator will take precedence.
One recent example where there is clear industry confusion 51 as to whom is actually responsible for imposing regulation is that of IRD interoperability, where the satellite service provider BSkyB has complained vociferously that the ITC has no powers to mandate minimum technical standards for the IRD 52 . It is argued, by BSkyB, that those powers lie with Oftel. This confusion arises from the failure to address all of the technical facilities and to explicitly define responsibilities.
However, the high cost, lengthy and complex regulatory process makes the regulation of each and every technical facility inadvisable. We are concerned with the apparent approach proposed in the UK Green Paper 53 , for ex-ante regulation of bottleneck facilities, without any apparent consideration of the implications of such regulation. In a dynamic industry it is also very difficult for the slow moving regulatory process to address each new facility as it develops and to adjust the regulation as any combination of competition, dynamics and technological development, acts to reduce the potential for abuse at any particular stage. It is also difficult to address the potential that may exist for technological by-pass of certain facilities and what the consequences may be for the consumers should the degree of regulation be regarded as too stifling. For example, as already noted it may be possible to introduce an IRD without an API. It is the consumer who suffers, as the IRD then has a lower degree of functionality and many of the benefits of digital television would not be realised.
5. Self-Regulation and Industry Standard Setting
Where specific regulation may fail to provide an adequate to the problem of ensuring fair and effective competition at the stages of technical bottlenecks it may be possible to provide standardised technical interfaces, where the technical specifications are effectively open, that is well defined and freely available for commercial exploitation. It may be then that standardisation provides a route around the bottleneck.
The primary beneficiary of standardisation is the network industry (e.g. telecommunications and television 54 , where the consumer benefit increases with the number of network users. Where there is competition between rival incompatible standards, it is often the case that where one standard is perceived to take a slight lead (in terms of the number of users) then there is a bandwagon effect, where new consumers move increasingly in favour of the "ahead" standard. This is a rational approach as the larger customer base may lead to obvious consumer benefits. For example, a subscriber to a mobile telephone service will be able to contact a greater number of people (and a greater number of people will be able to contact him) if he chooses the most popular standard. This tipping effect can be decisive in the market battle between competing standards and the user growth can become self-sustaining. During the standards battles the end result can often depend upon very subtle differences in the technologies and in changes in consumer perceptions of the perceived benefits. For an analysis of competition in the convergence sector it is important to appreciate the problems of standardisation and why the process itself may inhibit competition.
First of all, from the very brief description of the bandwagon effect and the explanation of network economics, it becomes obvious that once a standard has become entrenched it becomes very difficult to replace or to compete with it. This is not so much of a problem where the standard is a good one and the technical specifications are freely available, but when a superior technology (in whatever way that may be determined) is developed it may be impossible for it to achieve a critical mass in the market. It may sounds perverse but there are even problems associated with competition between rival standards. Where there is competition, neither standard may achieve the critical mass required to ensure a future for the technology, as consumers will often refuse to enter the market rather than risk purchasing the "losing" technology and becoming obsolete. In a dynamic environment, such as the converging industries, there is a great risk of premature standardisation. For example, while third generation mobile communications will not be licensed for some years, the International Telecommunications Union is already engaged in the process of standardisation. This is despite the fact that no-one is certain what use the consumers will seek to make of this mobile multi-media technology and the fact that competing standards may provide an indication of the consumer wants, rather than the wants of the technologists. Moreover, there is also a problem of market fragmentation, where "pockets" materialise, within which there may be a single standard, but there may be no compatibility between the pockets. The standardisation process itself may be corrupted by the nature of the standards bodies. Where these bodies are established for a specific purpose (e.g. to reach an industry agreement on the width of a widget), the extension of their "life" may be for the purpose of protecting either the established standard from external competition (in this case the process forms a trade barrier) from a competing standard, or to protect the established "owners" of the standard from new entrants.
This perhaps portrays too negative a view on standardisation. We also recognise the benefits. For example, in general, standardisation offers the following benefits:
There are three traditional approaches to standardisation: market driven, government imposed and technology industry driven. The method of standard setting and the structure of the body responsible is highly case specific. With the rapid technological challenges of convergence the traditional approaches to standardisation were shown to be inadequate and it soon became the norm for the industry to drive the process, and from a commercial rather than technological focus. The European Digital Video Broadcasting group (DVB) are responsible for producing an impressive list of technical specifications for all aspects of digital television and in a very short period of time. The DVB is a consensually driven voluntary industry group with more than 250 members world-wide. However, its reliance on consensus has demonstrated one weakness in this process. The case of conditional access is well known, where the DVB was unable to reach a satisfactory agreement and produced a fudged compromise solution, that required European Commission intervention in an attempt to salvage some credibility for the process. The basic problem with achieving a common standard on conditional access is that there were too many powerful vested interests, that were able to block what was not in their own interests. The existence of strong private interests among influential members disrupts the consensus-based system, perhaps beyond its degree of usefulness.
After an unexplained delay, that may have serious implications for competition in the market 55 , the DVB began to develop technical specifications for the EPG and for the API, as did national industry groupings, such as the UK Digital Television Group. While the DVB specifications do go some way towards facilitating the production of universal IRDs, with its specifications for service information and programme service information, they fail in that they permit private data formats for programme information. With this flaw, the specifications enable those who wish to exclude selected IRD customer bases. If a common format had been mandated then this would not have been possible. The WWW browser industry provides an excellent illustration of different browser suppliers running on different hardware, but all addressing the same information. This demonstrates that where there is a will, it is possible to achieve comprehensive standardisation. However, the existence of powerful self-interest acts as a barrier to the process of standardisation.
In the US standardisation of digital TV the conflict of self-interests has acted as a barrier to standardisation and has slowed the development process significantly. On the video format element of the digital TV transmission standard the conflict between the computer industry and the TV industry threatened to destroy the whole standard (until it was eventually and reluctantly decided to approve two video format standards). Conflict has again arisen between the two groups with regard the development of a standard for the API, with the computer industry strongly favouring the mandating of the current computer industry standard API, Win-32.
It is clear then that the desire for a common standard that would remove the potential to abuse the monopoly position may be futile and that a standard can raise as many difficulties as it solves. Moreover, the process itself can be used by dominant interests, to inhibit the potential for competition.
6. Regulatory Institutional Structure
An associated problem to that of definition of the 'bottleneck', is the structure of the institutional regulatory bodies, which examine and implement competition policy in the converging communications environment. Two alternative approaches have previously 56 been suggested: bottleneck control through specific regulation, or through generic competition law. These approaches are in addition to the asymmetrical regulation of dominant market actors evident in much telecoms 'local loop' access and interconnection regulation. Cave and Cowie caution that "a policy of minimum regulation would appear appropriate" 57 , as specific regulation may lack flexibility, and lead to technological by-pass and regulatory obsolescence in a market as dynamic as digital pay-TV. Generic competition law is flexible and acts as a more general deterrent to anti-competitive conduct. However, we conclude by cautioning against the use of such an instrument to pursue a narrower objective, where an alternative declaration of public policy is practically feasible. Where control of a facility is held to be egregious to public policy, a regulatory declaration to that effect may prove more transparent than continual efficiency- diverting litigation. In converging communication industries, the historical experiences of broadcast (specific spectrum 'bottleneck' regulation) and telecoms (asymmetrical regulation), are contrasted. In conclusion, we also caution that a converged super-regulator, though superficially attractive to European actors accustomed to continual intra-institutional turf wars, may bring a surfeit of institutional and operational baggage to competition cases, resulting in internal institutional confusion and investor uncertainty.
We examine four national institutional approaches 58 : Australia, the US, the UK, and Germany. It is the degree of flexibility, efficiency in enforcement, and transparency, which is examined, in view of our concern with specific and generic approaches to 'bottleneck' regulation. Australia exhibits generic competition regulation, Germany a federal-regional division of responsibilities for respectively telecoms and broadcasting, the UK a 'coexistence' of telecoms and television regulators supported by a newly reformed generic competition law, the United States a unified specific regulator supported by generic competition law. Proposals for reforming regulators are also compared.
Australia
Australia is in the forefront of de-regulatory policy in the communications sector and in 1997, replaced industry specific regulation with general competition law. The Australian Competition and Consumer Commission now has responsibility for the application of general competition law (under the Trade Practices Act 1974) to ensure that there is no undue restriction of competition in the communications industries. Although it is too early to offer a firm opinion on the success or otherwise of a system of control based entirely upon competition law, there are a few comments that we can make. The major difficulty in relying on competition law is the lack of industry specific expertise and while this can certainly be acquired there is a positive significant cost to this. This can lead to a lack of action on the part of the regulatory system, due to uncertainty of the economics of the industry in question. The ACCC has been vociferously accused of a failure to address problems in the telecommunications industry by the Australian Telecommunications Users Group Limited (ATUG), who have complained that the slow pace of intervention has lead to industry confusion and frustration 59 . It may be argued, however, that the high evidence requirement of the judicial system may slow the process. It will really require a substantial amount of case study material to ascertain the success of general competition law in Australia in controlling abusive behaviour in the convergence sectors.
Germany
Of our four case studies, Germany exhibits the greatest regulatory and institutional complexity in its governance of communications services 60 . Arguably, this is due to the rigidities of its federal constitution, under which a distinction is made between the responsibilities of states (lander) and the central government (bund). While these federal jurisdictional issues are familiar in the United States and Australia 61 , they are unusually strongly drawn under the post-war German constitution. States regulate broadcasting and media services - Mediendienst - while the federal government in Bonn regulates telecommunications, communications and information services - Teledienst. Recent policy debate in Germany has tended to concentrate on the constitutional rather than regulatory efficiency arguments. As Koenig and Roeder state 62 :
Neither states nor federal government dared the more holistic venture of changing the constitution, to create joint competence and a joint regulatory regime between federal and state government 63 .
They indicate that such constitutional prevarication prevents effective reform:
In creating a holistic "one-stop shop" for enterprises, Germany's position in the contest for investment in the sectors of telecommunications and media would be decisively improved 64 .
The surfeit of multi-level regulators for different sectors are in addition to the Federal Cartel Office, and the authority of the European Commission, a further layer of regulation which is shared with fellow European Union member states, including the UK.
United Kingdom
The UK system differs from that in Australia in that there are sector-specific regulatory agencies that are bound by competition regulation. Traditionally, the Independent Television Commission (ITC) has responsibility for the regulation of commercial television 65 , while the Office of the Telecommunications Regulator (Oftel) has responsibility for the regulation of telecommunications services. Competition policy is addressed by the Office of Fair Trading (OFT) and the Monopolies and Mergers Commission (MMC) 66 .
The transition to digital television has created a powerful argument for regulatory changes to address the specific regulatory challenges of convergence. While in opposition, the present government stressed the need to match the convergence of communications technologies with the convergence of regulatory bodies, in the shape of the much-hyped Ofcom (Office of Communications Regulation). Ofcom would oversee all the communications industries. While it may eventually materialise in the UK, we feel that it is an unnecessary step at this stage in the development of the technologies. For the UK, it is necessary to begin by asking for the tasks that would be required of the regulatory structure. It is then possible to begin a debate over the ultimate structure of regulation. We are pleased that the Government now accepts the validity of this argument and in the recent (very) Green Paper 67 on the future of regulation in the UK goes no further than raising for discussion a range of options for the future structure.
The present dual regulatory approach raises interesting issues. Where there is overlap of responsibilities it has proven sensible to encourage joint committees to address specific issues, but where matters are now explicitly identifiable with on regulator or the other, there has been confusion and industry frustration. Unregulated competition between the regulators raises issues of efficiency and, in particular, the questions of: which regulator will have greater ability to enforce regulatory decisions; and to which regulator will complainants turn for protection from abusive actions?
United States
In the US communications industry, the Federal Communications Commission (FCC) is responsible for regulating interstate and international communications by television, telecommunications and radio. Rather than adopt the single regulator structure of Oftel (and the proposed Ofcom) the Senate appoints five Commissioners, each for a year term, with the President appointing one of the five as Chair. The FCC is comprised of specialist bureau, each of which is responsible for a certain part of communications industry policy. The FCC has wide ranging powers, but is constrained somewhat by the rights of the US Department of Justice to become involved in competition issues and the litigious nature of the US regulatory system. In addition, an important role is played by state Public Utility Commissions.
While one of the proposals for UK Ofcom is based on the FCC style regulatory commission (see earlier), the FCC system is far from perfect. In view of the UK debate, in which outgoing Director General of Telecommunications, Don Cruikshank, argued for the implementation of a 'college of commissioners' model 68 , in contrast with the single regulator which was the model adopted in the privatisations of public utilities in the period 1984-91, it is striking that Harry Shooshan has argued recently 69 for the FCC to be reformed, in favour of a single regulator. A reasonable inference from such opposing views is that there is no easy answer to the personnel structure. As with any commission structure, there are clear differences in opinions as to regulatory matters on may occasions and it is often the case that these differences can slow down the regulatory process and lead to indecision. Where compromise is reached, as is often the case, it is clear that the regulatory decision is nothing more than a fudge and will be subjected to severe legal scrutiny. Despite the benefits of overseeing the whole communications market and being able to interpret the consequences of decisions in one sector for another and in particular for addressing cross-sectoral matters, the commission approach is not an impressive one. At the end of the day, regulatory structures are really a matter of regulators (i.e. the individual regulators concerned), but a single regulator is in our view undoubtedly a superior option to that of a commission.
Comparing Alternative Institutional Approaches
In the introduction to this paper, we briefly indicated the concerns raised by the European Commission Green Paper on the Regulatory Implications of Convergence. Its importance for future European regulatory structure merits re-emphasis 70 . Commissioner Bangemann has stated:
We may need to simplify the current framework and to perhaps bring together legislation on the provision of infrastructure, services, content and on conditions for access to that content (via TV, computer, or telephone networks)...10 years after the 1987 Green Paper [which led to telecoms liberalisation], we intend the Convergence Green Paper of 1997 to be a platform for defining the policy response to this evolving communications and media environment over the next 5 years 71 .
The implication is that a European-wide Federal Communications Commission, adapting the US model, be adopted. Equally, there may be reasonable disagreement regarding the 'coexistence' or convergence of discrete telecoms and broadcast regulators 72 . While the FCC is a converged regulator, it is arguable, and often argued, that transparent public disagreement is thus replaced by opaque internal negotiation processes. In the UK, the functional vertical distinction between carriage and content, as suggested by the European Commission Green Paper, is in practical terms indistinct. Individual licenses to broadcast, for instance, select from a menu of public and private obligations, rights and duties, in such diverse subjects as minority and commissioned programming, standards of fairness in journalism, and other policy considerations 73 . When combined with the wide discretion which the legislature and judiciary afford to the television regulator 74 , the regulatory landscape in the UK appears inimical to a converged regulatory arrangement based on competition law.
Resolving such an apparently intractable regulatory inheritance by resort to generic competition law, as suggested by Huber 75 , may therefore appear attractive, if politically unfeasible. The evidence from the most radical such regime, in New Zealand, is mixed, suggesting that competition policy alone may not resolve public policy concerns in a converging communications landscape 76 . It has already been seen, in our discussion of German and European Union regulation, that institutional and even constitutional issues, often far removed from considerations of economic efficiency, can override the issues we have thus far considered. Some general comments, supported by striking European case studies in political intervention in the regulatory process, may shed light on public policy considerations in which efficiency plays little part.
7. Public Policy Constraints on Generic Competition Law
Television content regulation, though often cited as in the V-chip debate, is not the only obstacle to rationalist economic analysis of convergence. Less predictable interventions are also evidenced, principled and less principled 77 . The use of generic competition law to pursue a much narrower objective, that of declaring an essential facility, is the approach evidenced in the Microsoft litigation, as also in the European Broadcasting Union case 78 . The definitional uncertainty of 'bottlenecks' in the vertical value chain is perhaps a symptom of the wider complexity of response to the issues arising in this dynamic market 79 .
In the European context, it is on public policy grounds, rather than generic competition law, that any attempt to impose the essential facilities doctrine on European digital pay-TV actors is strongest. European public service broadcasting goals of quality and diversity are not content- neutral. European regulators, unhindered by US precedents for the unconstitutionality of content rules, can be explicit in their embrace of such content-biased policy. The problem met in the Court of First Instance's European Broadcasting Union (1996) decision is that the application of generic competition law fails to embrace these wider policy goals. The EBU, the European public broadcasters' cartel, performs a video service somewhat similar to the print operations of the Associated Press in the US. Excluded commercial broadcasters, which compete with the EBU for sports rights, had complained that the widening of EBU membership to various commercial broadcasters 80 undermined the original public policy rationale for granting an exemption. The Court of First Instance found that EBU was in breach of its obligations under Article 85(3) of the Treaty of Rome, which grants prior notified exemptions for cartels which operate to the benefit of consumers or economic welfare, express economic parameters. DG IV had always given such an exemption under Article 90(2) in the public interest. This wider public policy consideration was struck out by the Court. EBU is now preparing an appeal to the European Court of Justice on narrower competition grounds.
However, there is a European precedent for a legislative approach, which brooks no judicial argument. Following the controversy described above in the European Broadcasting Union decision, and as a result of concern at European digital pay-TV operators acquiring the intellectual property rights to sporting events, Protocol 32 81 was in 1997 added to the Treaty of Rome, the basic legal document establishing the European single market. This Protocol establishes a privileged position in competition law for public service broadcasters. Another example of specific regulation, in the case of intellectual property rights, is the revised Article 3A of Directive 89/552/EC 82 . The Article ensures that transfrontier broadcasters must respect national legislation enforcing compulsory free-to-air carriage of specific listed events 83 .
One may therefore conclude that there are various non-competition responses to convergence, encompassing constitutional law and often unanticipated, shifting public policy goals. The certainty of regulatory lag, in digital pay-TV, tempts either a crude and excessive regulatory response, or industry resistance to regulation in any form, beyond a stage at which public policy dictates at least some regulatory intervention, if only to outlaw the worst excesses of content 84 .
8. A Tentative Conclusion
The regulatory principles of transparency and flexibility must be adhered to. In specific hard cases, in which fine judgements must be made on public policy grounds, such as in the Microsoft litigation or European digital pay-TV, it may be observed that government will intervene only when industry actors' behaviour is perceived as inimical to the public good (whatever the economic reality of the case). With this overriding policy assumption in mind, it is suggested that government regulate in specific circumstances using specific tools, where necessary. Economic theory evidently requires there to be overwhelming evidence in favour of such intervention, though legislative practice is less rigorous 85 . Generic competition law is too broad an instrument to brandish when pursuing a specific policy. Equally, specific policy should result from specific market analysis. Policy failure in generic competition analysis can result in a judicial decision, such as Tetrapak II, as described by Valentine Korah, "in a judgment that contains hardly any reasoning - mainly just conclusions." 86 The use of courts to settle fundamental policy issues in the European Union, is perhaps less well known than in the US. It is equally unsatisfactory. It is as well to note that generic competition solutions, in addition to the merit of flexibility, carry the liability of judge-made law, with often contentious political ramifications. In conclusion, there is therefore no right way to skin the cat, but perhaps no proven need to harm the creature in the first place.
End Notes
| Note 1: | Telecommunications Act 1984 Back. |
| Note 2: | Modified Final Judgement, breaking 'Ma Bell' into the 'Baby Bells' and AT&T Back. |
| Note 3: | See for instance, Hoffman-Riem, Wolfgang (1996) Regulating Media: The Licensing and Supervision of Broadcasting in Six Countries Guildford Press. A US perspective is provided in Noam, Eli M. (ed.) (1985) Video media competition : regulation, economy, and technology change Columbia University Press Back. |
| Note 4: | DTI/DCMS Regulating Communications: approaching convergence in the Information Age, Command 4022, HMSO, released 21 July 1998 Back. |
| Note 5: | At para.3.26 Back. |
| Note 6: | Cave, M. and Campbell Cowie (1996) "Regulating Conditional Access in European Pay Broadcasting", Communications and Strategies, No.23, 3rd quarter 1996 at 119 Back. |
| Note 7: | A debate stoked at European level by KPMG (1996) Public Policy Issues Arising From Telecommunications and Audiovisual Convergence, a report prepared for DG XIII, London September 1996 Back. |
| Note 8: | CEC (1997) COM(97)623 Green Paper on the Convergence of the Telecommunications, Media and Information Technology Sectors, and the Implications for Regulation, Brussels, 3 December Back. |
| Note 9: | The UK Green Paper is open to consultation until 30 November 1998. Supra n.4 Back. |
| Note 10: | For a 'snapshot' of the debate in October 1997 in the UK, see Marsden, C. (1997) 'Convergence or Coexistence? Television and Telecommunications Policies Diverge in the Convergence Debate' in JILT 3 at http://elj.warwick.ac.uk/jilt/wip/97_3mars/default.htm Back. |
| Note 11: | Temple Lang J. (1994) Defining Legitimate Competition: Companies' Duties to Supply Competitors and Access to Essential Facilities 18 Fordham International L.J. at 441-523; Ridyard D. (1996) Essential Facilities and the Obligation to Supply Competitors under UK and EC Competition Law 8 European Competition Law Review at 438-452; Furse M. (1995) The Essential Facilities Doctrine in Community Law 8 European Competition Law Review at 469 Back. |
| Note 12: | The television industry lends itself to decomposition into a series of discrete stages. Such decomposition is entirely arbitrary, but here we view such an exercise as useful Back. |
| Note 13: | The term "gatekeeper" refers to the controller of proprietary bottleneck facilities. Access to an installed base of reception equipment is only possible with the agreement of such operators Back. |
| Note 14: | Further, there are potential abuses that are specific to particular bottlenecks Back. |
| Note 15: | A non-discriminatory access charge may be fair but it is not economically efficient, as it fails to reflect demand conditions. This is especially the case for conditional access services Back. |
| Note 16: | It is certainly the case that regulation at the level of delivery has had more to do with political interference and public policy than economic efficiency and spectrum scarcity Back. |
| Note 17: | License conditions are commonplace, governing how the facility is actually used Back. |
| Note 18: | This raises issues of how to make the most efficient use of spectrum capacity, a topic that is beyond the scope of this paper Back. |
| Note 19: | For a discussion of the economics of access to content, see Cowie, Campbell and Williams, Mark, "The Economics of Sports Rights", Telecommunications Policy, August 1997 Back. |
| Note 20: | Ungerer, Herbert (1998) extracts from published speech, "Beating the band-width bottleneck" 14/05/1998 Paris http://europa.eu.int/en/comm/dg04/speech/eight/en/sp98017.htm Back. |
| Note 21: | There would be no gains to any downstream subsidiary to offset the lost profits at the upstream level Back. |
| Note 22: | From 'Windows' and 'Intel' - used to describe standard setting in dynamic high-technology markets at intermediate points in the vertical value chain. See further Borrus, M. and Zysman, J. (1996) You don't have to be a giant, Working paper 96A, Berkeley Roundtable on the International Economy (BRIE), UC Berkeley Back. |
| Note 23: | See Page, A.C. (1996) Technology and the Future of Antitrust Law 47 Fed.Comm.LJ 1 at 100. Shapiro, C. (1996) Antitrust in Network Industries, San Francisco, 25 January gopher://justice12.usdoj.gov:70/00/atr/talks/shapir.mar Biggio, C.E. (1996) Antitrust and Networks, San Francisco 2 February. gopher://justice12.usdoj.gov:70/00/atr/talks/biggiospc.txt Back. |
| Note 24: | Overd, A. and Bishop, W. (1998) Editorial: Essential Facilities: The Rising Tide, European Competition Law Review Vol.4 at 183-185 Back. |
| Note 25: | Commission of the European Communities (1995), (95/47/EC) EC Directive on the use of standards for the transmission of television signals 23/11/95 EN OJ EC No.L281/51-54 Back. |
| Note 26: | Areeda P. (1990) Essential Facilities: An Epithet in Need of Defining Principles, 58 Antitrust L.J. at 841 Back. |
| Note 27: | United States v. Terminal R.R. Association (1912) 224 US 383 Back. |
| Note 28: | Associated Press v. United States (1945) 326 US 1 Back. |
| Note 29: | Ibid at 29 Back. |
| Note 30: | MCI Communications Co. v. AT&T (1983), 708 F.2d 1081 (7th Cir.), cert. denied, 464 US 891at 1133 Back. |
| Note 31: | Commission decisions include: British Midland/Aer Lingus (1992) (Commission Decision EEC 92/213, OJ 1992 L96/34); B&I/Sealink, Holyhead (1992) (22nd Report on Competition Policy at point 219); Port of Rodby (1994) Commission Decision EC 94/119, OJ 1994 L55/52; Port of Roscoff (1995) 4 CMLR 677; Sea Containers/Stena Sealink (1994) Commission Decision EC/94/119, OJ 1994 L15/8; Irish Continental Group/C.C.I. Morlaix (1995) 5 CMLR 177. Non-shipping decisions include Sabena (OJ L317/47 [1988]). Temple Lang (1994) emphasises a 1981 case: IGR Salora. See White S. (1995) Is there an essential facilities doctrine in Europe? IBA 6th Annual Seminar on Telecommunications Services and Competition Law in Europe, Vienna, April 1995. Back. |
| Note 32: | Magill TV Guide/ITP, BBC and RTE (1989) OJ 78/43 [1989], Cases C-241/9/P and C-242/9/P Back. |
| Note 33: | Radio Telefis Eirann and Others v. Commission (1995) C-241 &242/91P, [1995] ECR I-743 [1995] 4 CMLR 718 Back. |
| Note 34: | Korah, Valentine (1998) The Ladbroke Saga, European Competition Law Review Issue 3 at 176 Back. |
| Note 35: | Economic rent is the surplus of revenue over costs Back. |
| Note 36: | Even here, there is some need to understand the existence of entry barriers and the appropriate policy response to the barriers Back. |
| Note 37: | Temple Lang (1996) at 5, http://europa.eu.int/en/comm/dg04/speech/six/htm/sp960541.htm Back. |
| Note 38: | The Director General's Review of BSkyB's Position in the Wholesale Pay TV Market, OFT, December 1996 Back. |
| Note 39: | The issue of third party access to the Verification software is not dealt with in this paper although inference can be made to the views of the authors on the appropriate regulatory treatment Back. |
| Note 40: | Electronic Navigation Systems are often also referred to as Electronic Programme Guides (EPG) or Event Scheduling Guides (ESG), depending upon their complexity and their user interface Back. |
| Note 41: | These are in addition to the general bottleneck concerns highlighted earlier Back. |
| Note 42: | Reference to the Microsoft system Back. |
| Note 43: | United States v. Microsoft Corporation (1998) District of Columbia Circuit Court of Appeal, Cases 97-5343 and 98-5012, decided 23 June 1998, from 94cv01564 available at http://www.cadc.uscourts.gov/common/opinions/199806/97-5343a.txt Back. |
| Note 44: | At 1 Back. |
| Note 45: | For example, the UK Digital Television Group's defined ESG will only allow the user to view schedules for the next 10 days Back. |
| Note 46: | Supra n.43 at 3: Joint Appendix 81, 86-89, to the case Back. |
| Note 47: | For example, see Hart and Tirole, Vertical Integration and Market Foreclosure, Brookings Papers: Microeconomics 1990; Bolton and Whinston, The Foreclosure Effects of Vertical Merger, Journal of Institutional and Theoretical Economics, 147 1991; Ordover, Saloner and Salop, Equilibrium Vertical Foreclosure, American Economic Review 80 (March) 1990 Back. |
| Note 48: | As noted earlier, without vertical integration, the incentive for abuse is removed Back. |
| Note 49: | This could have been interpreted as the first step towards a single communications regulator Back. |
| Note 50: | The original discussion on allocation of regulatory responsibility took place within a framework of fierce competition between regulators for control of digital television Back. |
| Note 51: | There is an industry cost associated with regulatory confusion Back. |
| Note 52: | Financial Times, July 28, 1998, pg. 20 Back. |
| Note 53: | Supra n.4 at para.4.6: "It would often be uneconomic to duplicate these facilities [CAS and EPG], but those who control them have considerable market power. These gateways are an instance of developments which justify ex-ante regulation." Back. |
| Note 54: | The more subscribers there are to a television service the more money the service provider has to invest in content, improving the value of the service to the consumer Back. |
| Note 55: | The longer the standard takes to develop, the longer the window of opportunity for a proprietary standard to establish critical mass Back. |
| Note 56: | Cave, Martin and Cowie, Campbell (1998) Not Only Conditional Access. Towards a Better Regulatory Approach to Digital TV, presented to Euro CPR '98 Conference Back. |
| Note 57: | At conclusion 21-22 Back. |
| Note 58: | A more detailed examination of five telecoms regulatory regimes is provided in Brian Levy and Pablo Spiller (1994) The Institutional Foundations of Regulatory Commitment: A Comparative Analysis of Telecommunications Regulation, 10 Journal of Law, Economics and Organisation 2, pp201-246. Their analysis of developing countries and the UK is applied to the US by Barbara Cherry and Steven Wildman (1998) An Institutional Perspective on Regulatory Regimes and Investment Decisions by Telecommunications Providers, http://www.its98.org/conference/library/showpaper.asp?id=730 Back. |
| Note 59: | ATUG Report Card, January, 1998 Back. |
| Note 60: | See generally Philipp Braun and Andreas Schaal (1998): Federalism, the Nation State and the Global Network: The Case of German Communications Policy http://ksgwww.harvard.edu/iip/iicompol/Papers/Braun-Schaal.html Back. |
| Note 61: | The UK is unusual in this respect, as the other systems exhibit some degree of federal-regional cooperation Back. |
| Note 62: | Christian Koenig & Ernst Röder (1998) Converging Communications, Diverging Regulators? - Germany's Constitutional Duplication in Internet Governance http://www.digital-law.net/IJCLP/1_1998/ijclp_webdoc_1_1_1998.html Back. |
| Note 63: | Ibid para.9 Back. |
| Note 64: | Ibid para.13 Back. |
| Note 65: | Note that the ITC has no authority to regulate the BBC Back. |
| Note 66: | Soon to be renamed the Competition Commission, and reformed under the Competition Act 1998 Back. |
| Note 67: | Supra n.4 Back. |
| Note 68: | Oftel (1998) "BEYOND THE TELEPHONE, THE TELEVISION AND THE PC - III" OFTEL's Second Submission - March 1998: http://www.oftel.gov.uk/broadcast/dcms398.htm#Section 5 at 5.20 Back. |
| Note 69: | Shooshan, Harry M. (1998) A Modest Proposal for Restructuring the Federal Communications Commission, 50 Federal Communications Law Journal 3, at 637-658 Back. |
| Note 70: | Marsden, C. (1997) JILT3 "The European Digital Convergence Paradigm" http://elj.warwick.ac.uk/jilt/commsreg/97_3mars/default.htm Back. |
| Note 71: | Bangemann, Martin (1997) Speech in Geneva on 8 September http://www.ispo.cec.be/infosoc/promo/speech/geneva.html Back. |
| Note 72: | See for a broadcast regulator's viewpoint, Redley, Michael (1995) 'The Case for Untidiness' in Converging Media? Converging Regulation? (ed. Richard Collins), Institute of Public Policy Research, IPPR, London at 21 Back. |
| Note 73: | See briefly Marsden (1998) Looming Battles in Britain: Fairness Regulations Meet the Marketplace, 12 Media Studies Journal 2, at 80-84 [Freedom Forum, NY, NY] Back. |
| Note 74: | See Gibbons, T. (1998) Regulating the Media (2nd ed.) Sweet & Maxwell, and for judicial intervention specifically, Marsden (1996) Judicial Review of the Channel 5 TV Licence Award: ITC Exercises Model Care, 5 Nottingham Law Journal 1 at 86-91 Back. |
| Note 75: | Huber, Peter (1997) Law and Disorder in Cyberspace: Abolish the FCC and Let Common Law Rule the Telecosm, Oxford University Press. For criticism, see Permut, Philip V. (1998) Dogma in Cyberspace, 50 Fed Comm L.J. Back. |
| Note 76: | An agnostic legal viewpoint is presented by Webb, Malcolm and Taylor, Martyn (1998) Light-handed Regulation of Telecommunications in New Zealand: Is Generic Competition Law Sufficient? http://www.its98.org/conference/library/showpaper.asp?id=674 A more optimistic assessment of the ability of generic competition law to regulate interconnection is provided in Evans, Lewis, Quigley, Neil (1998) Common Elements in the Governance of Deregulated Electricity Markets, Telecommunications Markets and Payments Systems, at http://www.its98.org/conference/library/showpaper.asp?id=850 Back. |
| Note 77: | As an example of a principled approach, it has recently been mooted that the relationship between competition law and its alter ego, intellectual property law, requires re-examination in light of the greater complexity and dynamism apparent in the development of the Internet. Barton, John H. (1997) The Balance Between Intellectual Property Rights and Competition: Paradigms in the Information Sector, European Competition Law Review Issue 7 at 440-445. Rather less principled US jurisprudence indicates that constitutional protection of free speech under the First Amendment is a potential source of reward for commercial litigants. See Nadel, M. S. (1992) A Technology Transparent Theory of the First Amendment and Access to Communications Media 43 Fed. Comm. LJ 2 at 157 Back. |
| Note 78: | (1996) 5 CMLR at 386. This decision has been appealed to the ECJ Back. |
| Note 79: | For a legal viewpoint, see Goldberg, D. and Verhulst, S. (1997) Legal Responses to Regulating the Changing Media in the United Kingdom 8 Util L.R. at 12-22 Back. |
| Note 80: | In the case of Canal+, a pay-TV channel Back. |
| Note 81: | Protocol (No 32) on the system of public broadcasting in the Member States (1997) http://ue.eu.int/Amsterdam/en/traiteco/en/conso2/conso2.htm Back. |
| Note 82: | The 'Television Without Frontiers' Directive http://europa.eu.int/dg10/avpolicy/twf/160497en.html Back. |
| Note 83: | ee Oreja, Marcellino (1997), Exclusive Rights for TV Broadcasting of Major (Sports) Events, SEC[97] 174 final. See further, the broader analysis on competition grounds by DGIV, Commission of the European Communities (1998) Broadcasting of Sports Events and Competition Law Competition Policy Newsletter No.2 (June) at 18-28 Back. |
| Note 84: | Producing an equal but opposite reaction. For an examination of public policy issues which adopts a prescriptive interventionist philosophy see Mathiason, John; Kuhlman, Charles (1998) An International Communication Policy - The Internet, international regulation & new policy structures http://www.its98.org/conference/library/showpaper.asp?id=589 See for a more catholic economic viewpoint, Spacek, Tom (1998) Internet Evolution: Some Communications Policy Implications and Guiding Principles for a New Policy Framework, http://www.its98.org/conference/library/showpaper.asp?id=539 For a salutary examination of interventionist privacy regulation, see Palme, Jacob (1998) Swedish Attempts to Regulate the Internet, http://www.its98.org/conference/library/showpaper.asp?id=549 Back. |
| Note 85: | Clear evidence of the information asymmetry between legislators and their telecom constituents. See C. Goodhart (1997) Economics and the Law: Too Much One-Way Traffic? 60 Modern Law Review 1 Back. |
| Note 86: | Korah, Valentine (1997) Tetra Pak II - Lack of Reasoning in Court's Judgment, European Competition Law Review Issue 2 at 98 Back. |