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IP/09/905

Brussels, 11 th June 2009

Telecoms: Commission clears ARCEP's proposal to maintain regulation in French broadcasting transmission services markets

The European Commission has cleared, by a letter published today, the proposal of the French telecoms regulator ARCEP to maintain regulatory obligations on the incumbent TV transmission services operator TDF. The regulation will apply to those TDF masts and sites that are impossible or very difficult to replicate. Alternative transmission service providers need to have access to these sites under adequate conditions to provide competing transmission services to digital television broadcasters and multiplex operators. At the same time, however, the Commission invites ARCEP to monitor the extent to which TDF's sites can be replicated and the competitive developments on the market so as to ensure that the regulatory obligations to be imposed on TDF remain justified and proportionate.

Competition Commissioner Neelie Kroes said "I fully support the view of ARCEP that the current level of competition in the French TV transmission services market needs to be preserved. This can be accomplished by maintaining and refining the conditions under which TDF gives access to masts and sites that are difficult to replicate to operators who provide transmission services. In particular, in the light of the ambitious roll out of digital terrestrial transmission in France, TV broadcasters or operators of multiplexes will also in the future be able to select the transmission service provider that makes the best offer in terms of quality and price."

"Alternative broadcasting operators in the French market need more time to secure their position as competitors to TDF. They need to be given the opportunity to compete on an equal basis for new contracts, so that at the end of the value chain, French households are being delivered competitive, qualitative TV services at fair prices. Therefore, the European Commission today has given the 'green light' to ARCEP's proposal", added Viviane Reding, EU Telecoms Commissioner.

Currently, French households mainly rely on analogue or digital terrestrial television services to watch TV. As analogue terrestrial television will be phased out in France by 30 November 2011 at the latest, the terrestrial network is being digitalised at high speed. Terrestrial television is therefore likely to remain the principal broadcasting platform in the near future. Alternative platforms such as satellite, DSL, cable and fibre each have their strengths, but none of them equals the penetration and coverage of the digital terrestrial platform.

The terrestrial broadcasting transmission services market, where TDF offers services over its masts and sites to competing providers, remains largely in the hands of TDF, who has a market share of around 93%, despite regulatory measures imposed at the time of ARCEP's 2006 market review. There is little sign of increased actual or potential competition on the market. Therefore, ARCEP intends to maintain the current obligations under which TDF must provide network access on non-discriminatory, transparent terms. While TDF also remains subject to the obligation not to charge excessive or predatory prices for access to its masts and sites that are difficult to replicate, it is now required to charge cost-orientated tariffs for access to its non-replicable sites.

The Commission cleared ARCEP's proposal to continue regulating the broadcasting transmission services market and thereby ensure that competing operators continue to invest in their own infrastructure. At the same time, the Commission invites ARCEP to follow the competitive developments on the market. Some sites may be more easily replicable and could, over time, become characterised by a tendency towards effective competition and no longer warrant regulatory intervention. ARCEP should therefore closely monitor whether the proposed maintenance of regulation on such TDF sites remains proportionate and justified.

Background

On 7 May 2009, ARCEP notified the Commission, as required by Article 7 of the EU Framework Directive, of a draft decision on the market for wholesale broadcasting transmission services in France. Although this market is no longer included in the list of markets where the Commission recommends regulation ( IP/07/1678 ), a national telecoms regulator may decide to regulate if it is duly justified.

The " Article 7 procedure " (see MEMO/08/620 ) leaves considerable scope to national telecoms regulators on how to achieve effective competition, but requires them to notify draft regulatory measures to the Commission. Where these measures relate to markets or operators with significant market power, the Commission has the possibility to require the regulator to withdraw the measure. Where the measures concern regulatory remedies, the Commission may make comments which the national telecoms regulator should take into utmost account.

The Commission's letter will be made available at:

http://circa.europa.eu/Public/irc/infso/ecctf/library?I=/commissiondecisions


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