A weaker EU authority
By approving the report drafted by Conservative MEP Pilar del Castillo Vera, MEPs rejected the Commission's proposal to establish a strong new EU authority for the telecoms sector. EECMA (the European Electronic Communication Market Authority) would have supervised the 27 national regulatory authorities, under the control of the Commission.
The body would notably have had the power to block remedies imposed by national regulators if they contradicted European principles: a plan staunchly opposed by national regulators.
Instead, MEPs voted in favour of a less-centralised Body of European Regulators in Telecoms (BERT), which would share veto powers with the Commission. BERT would in fact be a strengthened version of the current ERG (European Regulators Group), which currently represents national authorities (EurActiv 09/07/08). Nevertheless, in a positive move for EU enthusiasts, decisions by BERT would be taken by a qualified majority of two thirds rather than unanimously.
Functional separation in 'exceptional' cases
While MEPs endorsed a proposal requiring telecoms operators to split their network business from their retail services - known as 'functional separation', which the Commission hopes will boost competition in national markets - they insisted that such a measure be only "exceptionally" applied, requiring approval by both the EU executive and the European regulatory body.
Spurring investment in next-generation networks
Upgrading the original Commission proposal, Parliament proposed a series of measures to spur investment in next-generation optical fibre networks, which are expected to become the backbone of the Internet of the future, offering high-speed, high-definition services.
At the request of Socialist MEP Catherine Trautmann, who drafted the report on the issue, Parliament voted in favour of infrastructure competition, pushing all operator to build its own network.
The move was welcomed by large incumbent companies but criticised by smaller ones due to fears that they will be weakened. But the text makes a concession to smaller market entrants by recognising the right of operators without any infrastructure of their own to access existing fibre networks.
Spectrum management
A review of current rules governing radio spectrum is considered key to offering a new range of services to European citizens, from mobile internet to widespread interactive television. The review is geared towards better exploiting the 'digital dividend', meaning radio frequencies freed by the gradual transition from analogical services to digital ones.
To do this, the Parliament agreed that management and allocation of the spectrum should be left mainly up to member states, with only some frequencies under European management. This triggered wide support from the broadcasting industry, which considers it easier to get its voice heard by national authorities than by a one-size-fits-all European model.
The telecoms sector and the cable industry were less happy, with the former lamenting that new mobile phone-based services will not be favoured by the new framework and the later criticising the extension of 'must-carry' obligations to all audiovisual media services, including satellite and cable. They say this will hinder the development of on-demand services.
Privacy, security, copyright and consumer protection
The Parliament also made a number of changes to the Commission's proposals to improve privacy and security on the Web.
The idea of transforming internet service providers into a sort of online police service, filtering all downloads and punishing serial anti-piracy rulebreakers, was dumped after strong pressure from the telecoms industry and consumer support for free downloading and peer-to-peer websites.
What's more, MEPs decided that the processing of personal data should not require the prior consent of the user - a move that will make life easier for anti-hacker operators but keep privacy protection on the Web low.
MEPs also side-stepped the issue of whether IP addresses - which are crucial for the identification by service providers of Internet users and through which Web giants can acquire much user information - should be considered as personal data.
On the other hand, they approved the application of a prior consent clause to software that automatically reports back to remote computers, such as cookies, which are installed in users' computers and provide information on their behaviour to the companies that create them, like search engines. With this legislation in place, cookies and other software based on this principle will have to ask users' permission to report back. However, providing a simple button in the browser for the acceptance of cookies should be sufficient, raising doubts as to the effective protection of consumers' privacy.
According to Liberal MEP Alexander Alvaro, who proposed the measure, making it a duty to report security breaches would be enough to provide internet users with maximum protection.
The review also includes higher transparency requirements for the pricing of electronic services and better contractual information. "Too often, consumers are not told if they will be required to pay significant sums for their handset if they break a contract early or if services such as Skype are blocked on their handsets. All this will now change," explained Conservative MEP Malcolm Harbour, who drafted the report approved in the Parliament plenary.
