Member of the European Commission responsible for Information Society and
Television is going Mobile – and needs a pan European policy approach
International CeBIT Summit
Hannover, Germany, 8 March 2006
Good afternoon ladies and gentlemen,
It is a pleasure for me to address such a distinguished audience on the occasion of the CeBit fair.
Today, I would like to share with you some thoughts on a very topical subject: the development of mobile Television in the context of our European policies for Information Society and for the Media.
Mobile TV is a key example of the digital convergence between networks, devices and content. And digital convergence is important because it is a carrier of new business opportunities, new jobs and new consumer services, which is why I have placed it at the heart of my i2010 strategy framework for the Information Society,
But digital convergence also creates new challenges for market players and also for governments and regulators. I would like to address these challenges today.
Media on the move: an irreversible trend
Mobile TV seems set to become the next high growth consumer technology. It is at the crossroads of two powerful social trends: greater mobility, and new forms of accessing media content.
1) Mobility is a powerful driver of growth: in early 1990 even the most optimistic forecasts for mobile phones were 40 million users worldwide by the turn of the millennium. Today over 1.5 billion people use GSM phones worldwide (with approximately 430 Million in Europe). This growth continues; one million new users sign up to GSM services every day. European industry and business have clearly benefited greatly from these developments: a study by Deutsche Bank estimates that GSM contributes about 2% to Europe’s GDP. This is a significant achievement.
We all know it from our own lives. The new found mobility and freedom of communication that GSM has given us has changed the way we work and our daily life. Many applications were a surprise: think how SMS has created entirely new social networks, particularly among youngsters. Mobility and mobile systems are also helping to bridge the Digital Divide. In Asia, Latin America and Africa we see massive take-up of mobile networks.
2) Media content consumption is also changing. New diverse audiovisual services are emerging, based on the internet, outside of the traditional triangle of TV, radio and written press. A content revolution is in the making. Internet diversifies information channels and – more far reaching - it has a significant economic impact on business models and advertising budgets. We can expect more personalised; time shifted; on-demand; non-linear services. Consumers will expect more choice and more individual treatment. On-line content markets are predicted to double in size in the next three years to reach nearly 3bn€. The amazing growth rate of blogs (a new blog is being created every second) is another example that points in that direction. The success of video on demand services is another indicator. If we use this opportunity right this trend offers not only new growth opportunities, also a new channel for creativity, diversity and democracy.
Media on the move: unlocking content
Mobile TV’s combination of mobility and personalised, on- demand consumption spearheads the new wave of mobile content. Mobile media consumption is already there, with the rapid rise of audio and video downloads onto portable and 3G terminals.
Over the past few months, millions of mobile video sessions over 3G networks in Europe, fuelled by the emerging partnerships between content and communications players. The 2006 World Cup here in Germany, will accelerate this trend.
Content that is downloaded on demand by the user – which represents most of the content on today’s mobile networks - is known as a ‘non linear’ service. The Commission has taken the first steps to accompany this important evolution of the content consumption modes. Our proposed modernisation of the “Television without Frontiers” Directive aims to modernise the rules that govern content distribution. The divergent rules on on-demand content and the lack of a consistent IPR regime across Europe are holding back innovative services such as mobile television. The modernised directive therefore, founded on the Country of Origin principle, will tackle part of this problem by allowing on-demand audiovisual media services to fully exploit the EU internal market – just as terrestrial and satellite channels have over the last fifteen years. This proposal for a modernised, light touch directive, made by the Commission at the end of 2005, is currently being debated with the Council and the European Parliament. When it is approved, this European legislation will be applicable to mobile on-demand TV content as it is now to mobile linear TV content. It will create the legal framework which mobile on-demand TV needs to develop in the single market. In addition, to tackle the question of IPR, I will present a Commission communication on "Content On line" before the end of the year.
Media on the move: unlocking the frequencies
This development will soon lead to a capacity barrier. The results of the first pilot projects suggest half of European mobile phone subscribers may become mobile TV users.In Europe, this represents up to 200 million people.
3G investors that are deploying mobile infrastructures are already accepting that, even with the rollout of HSDPA 3G networks, there will be a need for complementary networks and technologies in order to meet this demand. This means that, if we want Mobile TV to be the next economic carrier wave of technological, industrial, and consumer services growth, we had better make sure that we create enough space for these services to take-off.
In particular, we have to make sure that harmonised spectrum is available across Europe, so that consumers can access services on their travels: this is the European freedom to move.
Access to frequencies is characterised for the time being by a patchwork of national regulatory and usage approaches, which has not kept pace with technological developments, and which is not well adapted to new services such as mobile TV. If we want European players to develop efficient business models in that field, we need a coordinated approach on spectrum policy.
We cannot afford to sleep on this. Actions are already well underway outside Europe. Spectrum has been made available across the whole US territory; paving the way for a nationwide roll-out of mobile TV networks. Japan has developed its own technology and is planning for national deployment this year. China is considering whether to select a technology by the time of the Olympic Games in 2008, and has started to experiment mobile TV in public transportation. Korea, the most advanced nation in the field, has already opened up commercial services.
That is why we should act now to allocate at least some common European spectrum bandwidths for Mobile TV.
In the medium term, as mobile TV takes off, we may need further bandwidth for the new mobile, audiovisual services that come on stream. This means we should start serious discussions now about the use of the digital dividend for spectrum: including further harmonisation at EU level of frequency bands for potential use by services such as mobile TV. I am more and more convinced that we cannot wait until 2012 to deploy new services such as mobile TV on a large scale. I also follow with attention possible innovative solutions as regards mobile TV such as the use of satellite capacities.
Mobile TV is an opportunity for Europe. It is also a natural successor to mobile telephony. In a first step, to stay in the game, we have to move now to create an initial set of bands that can be used for Mobile TV. I see this issue as a matter of urgency: decisions must be taken in the coming twelve months.
This is a complex task. It is not just a question of allocating frequencies. But it also requires that we decide on consistent and workable approaches to the terms for licensing and fees for this radio bandwidth.
This will not be easy. But this is urgent, if we want Mobile TV to be based on European technologies and content. European industry is at the origin of many of technologies being used today to launch mobile TV services. The EU-funded R&D programmes have provided significant support. Many Member States started mobile TV pilot trials in 2005, notably the UK, France, The Netherlands, Spain Finland, and Italy. Here in Germany, a number of regional pilot trials also started last year, and experiments are currently under way with the two standards currently dealt with by the European Telecommunication Institute (ETSI), notably DVB-H and DMB. We need now to capitalise on all these efforts and investments.
In a second step, Member States should also seriouslyengage in the discussions on how to capitalise on the digital dividend that will come from the switching-off of analogue TV. Part of this discussion should be on the allocation of channels for Mobile TV. We cannot wait until 2012 to start this discussion, it will be too late. In a global world, Europe has to move at the rate of our fastest competitor not our slowest member.
I therefore call on Member States to move in a citizen-friendly and business-friendly way, to have a light touch approach and most of all to take the right decisions quickly and efficiently.
Media on the move: standards & interoperability
The issue of standards is important as well for the success of mobile TV services in Europe. This is for several reasons: first, the choice of a standard has heavy consequences in terms of technologies used to deploy the service and accordingly in terms of patent ownership and royalty fees. I would like the technologies used in Europe for mobile TV to be the best for the consumers and for the European companies at all levels of the value chain.
Second, the choice of a widely accepted standard - such as GSM for mobile telephony - is of paramount importance to get economies of scale. This is one of the arguments put forward by us, the Europeans, to convince Brazil and Argentina to make the choice of the worldwide deployed DVB standard in their ongoing transition from analogue to digital television. We need to apply the same logic in Europe as we promote abroad.
I see a clear need to “think pan-European” whenever we look at mobile technologies and services. With a mobile device, consumers are naturally inclined to roam beyond their national borders. Consumers expect continuity of service whenever a national or regional border is crossed. Member States will need to reflect on cross-border requirements as they plan services with operators and broadcasters. For the Commission, there is therefore an EU internal market issue at stake here. I am convinced we need an approach to interoperability for Mobile TV that supports this important new market, rather than constraining it. Industry should take the necessary steps to make interoperability possible. I hope they will. Obviously, IPR licensing regimes should also be consistent with this Europe wide perspective. I make an offer: if industry calls upon the Commission to assist in achieving these goals we will do all that we can to assist.
In addition, interoperability does not just have a technical dimension, but also a regulatory dimension requiring a pan-European approach: sufficient clarity and flexibility of authorisation rules at Member State level is required. Licensing regimes must make sense in terms of the Internal Market that will govern the deployment of Mobile TV infrastructures.
Last but not least, I see a great challenge for European audiovisual content providers, i.e. to develop new, attractive formats and original contents, for a mobile consumption. While the US content industry is already working on this – for example by adapting the most acclaimed TV series to consumption on a mobile phone – we seem to be lagging behind here in Europe!
Media on the move: a European approach
These considerations point in one direction: we need a pan-European approach to set conditions for a rapid and wide deployment of mobile TV. Europe has led the race to develop Mobile TV technologies. We now need to facilitate deployment and market developments, and I want to share with you what I consider would be a realistic approach to that end.
In the very short term, we should concentrate on three clear areas of activity.
First, over the next 12 months we need a minimum harmonisation of radio bands at European level to allow Mobile TV services to get started. We urgently need to check the technically feasibility of making such spectrum available and to give legal certainty for a start up phase Europe wide markets for mobile TV in Europe.
Second, Member States must accelerate discussions on the use of the digital dividend, including the possibility to harmonise some of it at EU level. The “Regional Radio Conference 2006” (RRC 06) and the “World Radio Conference 2007” are important milestones for this debate, because they will define frequency plans for the future. The EU needs to be in the driving seat in these for a, with clear and consistent positions for the use of the dividend.
The Commission is working on both these issues with the Radio Spectrum Policy Group of the Member States. And I trust that we can expect this group to produce opinions that will assist Europe’s position. They have already supported us in maintaining flexibility on the use of the future dividend. By October I expect their opinion that it is feasible to make spectrum available for mobile TV, taking the results of the Regional Radio Conference into account. By early next year they should take a position on the use of the digital dividend.
The third area of immediate activity is for industry. We need undivided support and commitment from industry. Industry should come up with a set of recommendations during 2006. These recommendations should give a clear and reasoned position on spectrum requirements. I also expect concrete proposals on a Europe-wide approach on standards, interoperability and coverage. We also need an elaboration of the business case for these developments: market prospects, business models and development scenarios under different assumptions of the pathway to analogue switch-off and authorisation rules.
These are the essentials to move forward. I will follow developments of this hot topic with interest and will come forward with a Communication early next year - this communication will be called "Strengthening the Internal Market for Mobile TV" - based on the results of the work we get done this year and proposing specific further steps to unlock the potential of Mobile TV.
Ladies and gentlemen,
The elements I have outlined are my proposals to develop a European approach on mobile TV issues in Europe.
Little will happen without the readiness of Member States, industry and other stakeholders to act jointly with the Commission, by actively helping to develop a European strategy for Mobile TV. This is just one more concrete example that we need a partnership on a coherent European approach to spectrum. I am prepared to promote the much-needed dialogue at European level. But you should also be prepared to deliver your part of the deal.
The opportunities for growth are there. Many new European jobs can be created. Mobile TV is a perfect and concrete example of the opportunities that digital convergence offers. It is a key step towards the deployment of innovative wireless technologies in Europe. Let’s face this challenge together.
Thank you very much for your attention.