Joint Committee on the Draft Communications Bill Minutes of Evidence


Memorandum submitted by NTL

  NTL is pleased to have the opportunity of commenting on the draft Communications Bill.

  NTL is a communications company providing affordable access to TV, radio, telephone, Internet and other services throughout the UK. We are the largest company in our market, with over three million customers choosing to take approximately five million individual services. Of which, 2.54 million homes take at least two services. 38 per cent of these customers take the so-called "triple play" of TV, telephony and internet services.

  A separate part of our business, NTL Broadcast (whose origins lie in the Independent Broadcasting Authority's engineering arm) is a major provider of transmission and other services to TV and radio broadcasters.

  These written observations set out NTL's overall reaction to the main issues raised in the draft Bill. We recognise that the Committee has expressed a particular interest in five aspects of the draft Bill, and we would be pleased to expand on our views on these five aspects (and any other interest to the Committee) when we give oral evidence.

SUMMARY

  We welcome this draft Bill. If and when introduced, it would signal a quantum leap forward in the way the industry is regulated. Despite numerous delays the Government have used their time skilfully to produce a generally well thought out, forward looking and consistent set of policies that we welcome. However, it is worth noting early in our remarks that in a number of important respects, the Government's plans are incomplete or undrafted. If additional details are forthcoming before the end of the Joint Committee's consideration of the Bill, we may wish to return to the Committee with additional comments.

  The UK requires world class communications companies, with the scale and ambition to be truly innovative in the development of content and technology. This may necessitate further consolidation. Reforming cross-media ownership rules and allowing consolidation is a necessary, and welcome, step—it will allow stronger, more effective commercial broadcasters to develop.

  However, the broadcaster interests are only a part—and in term of importance to the economy, a relatively small part of the sector as a whole. The Bill needs to also deliver real benefits for other market participants.

  Economic regulation needs to take place at internet speed: and by this, we mean broadband internet, not dial up. We emphasise this point, recognising that the bread and butter issues of economic regulation may appear somewhat arcane. Nonetheless, it is absolutely central to the future activity of OFCOM, and to the achievement of the Government's objectives, that regulation works effectively to promote consumer benefits and crack down on anti-competitive practices.

  Will the Bill stand the test of time? Businesses work against planning cycles which typically look to three to five year timescales and beyond. It is important that the Bill provides predictability and certainty over such timescales. Equally, the Bill must have the durability to last for a minimum of two Parliaments. Previous broadcast legislation has required revision within five years of implementation, partly because it dealt with the issues of the moment not the issues of the future. There is a danger that legislation first conceived in 2000, introduced in 2002, and fully in force by 2004 means that we require further changes to be made in 2005. It is surely not desirable that the legislation currently before the Committee would need to be substantially re-written before the ink is dry.

CONVERGENCE

  The cable industry represents the truly converged media.

  By convergence, we mean:

    —  at the technical level, transmission media are now very similar in terms of their core components and elements;

    —  at the distribution level, services associated with particular platforms can now be delivered via other platforms, so internet can be delivered on the TV and voice telephony over the internet using IP; and

    —  at the content creation level, providers can now design content (such as original drama or news) for distribution across a variety of different platforms and media.

  Convergence is not a pipe-dream, it is happening as we speak:

    —  NTL customers across the UK enjoy their digital cable TV, but can do much more than passively "watch". Every month over 1.7 million e-mails are sent or received via the TV set. Using the TV screen, our customer can sit on the sofa and surf or e-mail. At half time in the World Cup matches our customers will be able to e-mail their views on the first half action to friends around the world. The internet and TV coverage;

    —  text messaging has been great news for the mobile phone industry. Millions of users are comfortable using the small handset to text. So how about texting using the TV remote control? It's even easier. Today, our customers are able to text friends via their TV set, without missing the TV programme. The mobile phone and TV coverage; and

    —  broadband access makes watching video on the PC quick and easy. It's the internet as it should be. Our broadband customers will soon be able to watch the best internet news, weather, sport, music videos, games and even the best of the World Cup goals on their PC. TV content converging with the internet through the PC.

  Converging technologies need a convergent regulatory environment, which is why NTL welcomed the publication of the draft Communications Bill. Convergence goes to the heart of this legislation and despite it not happening either as quickly or in the exact form which some predicted, the merits of convergence have been largely ignored in the public debate focusing on linear broadcasting issues. The singular opportunity afforded by the Government's review of the legislative and regulatory framework is being missed. Broadcasters and industry players, including certain sections of the Government find themselves responding to an increasingly digitised and converged environment that drives innovation faster and farther than ever before contemplated. In particular the gauntlet needs to be thrown down to the traditional linear broadcasters to embrace the development of broadband content, and not simply defend the status quo in linear broadcasting.

  While the Government has been justly criticised for repeated delays to the legislation, the market has moved on. A huge range of services, increasingly with an interactive element, are being accessed through a variety of mediums with multiple functions. It is in this arena that the broadcasters and telecoms companies will find the future. The major challenge for Government to contend with is whether they have produced a set of proposals that will stand the test of time in a very fast moving environment. In all likelihood this Bill cannot hope to keep up with or reflect all the changes that are happening but the general approach the Government has employed does provide a better chance that the legislation will still be relevant for years to come.

  NTL has consistently called for legislation that is sensible and has a clearly articulated policy framework which, is underpinned by the belief that the realisation of Broadband Britain is essential to the achievements of the Government's aims. The fact that the draft Communications Bill is too late to resolve the problems with DTT or deliver unbundled local loops will not be serious if the legislation promotes, facilitates and drives forward the aims of competition, convergence and broadband in many sectors including education and health.

  We contend that before the legislation is considered "fit for purpose" by Parliament it must be able to pass the five tests of convergence.

THE FIVE TESTS OF CONVERGENCE

Does the Bill support a truly convergent vision of tomorrow's media landscape?

  Tomorrow's digital landscape needs a clearly articulated policy framework, underpinned by a belief that Broadband Britain—which will provide the electronic infrastructure for a modern knowledge economy—is essential the achievement of all of our goals. NTL believes that the key public policy objective should be to build a nation of connected, broadband homes, not merely homes receiving television in digital format. In our view, the current preoccupation with digital TV and analogue switch-off should be a sub-set of a bigger debate about achieving Broadband Britain.

Will the Bill encourage and foster competition?

  NTL believes that the Government needs to accelerate the current timetable for regulatory legislation. The UK must have an economically sustainable competitive media landscape if Broadband Britain and a truly connected nation are to emerge.

Will OFCOM have the power to bring about "internet speed" regulation?

  The converged communications industry is a fast moving sector with product development measured in months not years. NTL wishes to underline the need for regulation that reflects the industry's pace. "Snail-pace" regulation serves only to support the dominant player and gives little comfort to those seeking to bring alternative options to market.

Will OFCOM be fully converged?

  NTL welcomes the move to regulate convergent sectors under a single body. However, OFCOM itself must be truly converged—as opposed to five different organisations, bolted together and working in separate "silos"—if it is to achieve real comprehensive oversight and successful regulation of the industry.

Will the Bill stand the test of time?

  A wide range of communications services, increasingly with interactive elements, are being accessed through a variety of mediums with multiple functions. It is in this arena that the broadcasting and telecommunications sector will find the future. The major challenge for government to contend with is whether or not they have produced a set of proposals that will stand the test of time in a very fast moving environment.

EFFECTIVE REGULATION

  A fair and level competitive playing field is essential for Britain and the proposed legislation should help ensure that this is the case in the media and telecommunications sector. Without competition, commercial choice and pluralism can be stifled, particularly in the media environment. We believe that competition is what drove down telephone prices and drove up quality of service. Competition is what has placed the UK at the forefront of the rollout of digital TV and competition is bringing Broadband Britain out of the shadows.

  One of the most important lessons from the industry's recent travails is that it would be an error on the part of the Government to try to pick a winner in content or platform terms. This Bill clearly demonstrates that the Government is not going to be swayed by the short term ills of the sector and will maintain a strict pro-competition policy and neutrality over platform and content. This country needs diversity and most of all its needs an economically sustainable competitive media landscape.

  Converged regulation, as personified by OFCOM, is potentially a very positive and imaginative step forward. The environment that OFCOM creates will be critically important for giving the UK the sort of regulatory regime that it needs to retain its position as the most attractive place for global business and internationally mobile investment.

  Creating OFCOM at this point in time presents us with an opportunity to produce a better result than we currently have and to streamline regulatory decision-making. NTL supports the creation of a cross thinking regulator, bringing together the strengths of the existing regulators and dropping the biases which can sometimes produce poor, inconsistent or ill thought-out decisions. However, OFCOM will be a failure if it becomes a glorified landlord with five new tenants living side by side under one roof but not benefiting from living together. For the consumer to truly benefit form the five regulators being brought together, the temptation to retreat into silos must be avoided.

  We believe that the basic structure proposed, of a board consisting of executive and non-executive appointees, is broadly right, given that OFCOM will require a mix of managerial, technical, economic, legal and policy-making experience. For OFCOM to be professionally competent we contend that a small, tighter core of experts at its apex is required. The numbers of appointees, however, should not become unmanageable. Six board members in total seem to us to be quite sufficient to provide the necessary skills mix and balance of views. This is particularly important when you consider the Secretary of State's reserved powers to make extra appointments. For the benefit of OFCOM's political independence, the appointment of extra members to revise existing members' decisions should be resisted.

  OFCOM must be genuinely independent from Government, adequately staffed with top-quality people, and led with courage and clear-sightedness. OFCOM should be powerful enough both to act swiftly and effectively when action is needed, and to be able to refrain from interfering unless and until action is really necessary.

  The great danger with broad-ranging body like OFCOM is that this duty will be subsumed in a wider organisational brief which includes—inevitably—acting as a lightning rod for explicitly political concerns such as news media bias or taste and decency. Focusing on the long term avoids the regulator falling into the trap of short-termist or overtly "political" decision making. The focus on the long term is crucial for economic regulator in particular.

Focus on competition

  Rightly, the Bill places the delivery of benefits to consumers at the heart of the functions and duties of OFCOM. It also makes clear that the principal means by which such benefits are to be achieved is through the promotion of competitive markets. Again, we think this is absolutely correct. In particular, we strongly believe that competitive markets are much more likely to deliver consumer benefits than markets which are monopolistic, no matter how tightly regulated the monopoly. There are two reasons for this: first, experience in the utility sector highlights that monopolies always have an information advantage over the regulator, making it very difficult for the regulator to genuinely replicate the effect of a competitive market (for instance in the setting of price controls); and second, because the principal means by which customers will benefit in consumer markets is through product and service innovation, something which it is notoriously difficult to promote via regulation.

  So OFCOM will need to identify and treat the causes of consumer problems—the barriers to entry which make markets monopolistic, and the abuses which prevent entrants from capturing market share—and not simply alleviate the symptoms of monopoly. We emphasise this point because in reality economic regulation of the telecoms sector is still very skewed towards the latter. Oftel has many more people handling "soft" consumer policy issues than it does addressing problems in broadband markets, for instance.

  It would be helpful if the Bill was amended to describe the duty as promoting the long-term interests of the consumer, through competition.

  Crucially, the series of duties listed in Clause 3 of the draft Bill do not specify any hierarchy. However, it appears that Clause 4 requires, as far as the discharge of economic regulation is concerned, that if a conflict arises OFCOM should give primacy to a separate set of duties imported from the European legislation recently enacted. Those duties do place the promotion of competition and efficient markets as the primary duty. It would be helpful for the Joint Committee to seek clarity on this point as it would be better to have competition identified as the primary duty in advance to avoid any future conflict.

  There is a significant danger that sector regulation will get lost in the overall mix of activities within OFCOM—a process likely to be exacerbated, given the high-profile nature of issues in the broadcast sector. Now that it is suggested that there will be a Content Board, we believe the case is reinforced for an Economic Regulation Board as its equivalent, staffed with appropriate expertise and operating to the required very exacting timescales and procedures.

  We urge the Committee to lend its support to the idea of a separate Economic Regulation board within OFCOM, staffed by appropriately qualified people, and to ensure equal weight to have the same reporting lines as the Chairman of the Content Board into the Chairman/Chief Executive.

Sector regulation or competition law?

  Since full liberalisation, the regulatory debate in UK telecoms has been to what extent sector-specific regulation is still justified, as opposed to the transition to generic competition law alone as a means of policing anti-competitive behaviour.

  BT still controls 75 per cent of all residential call revenues, a £5 billion per annum business. This is remarkable, given that we have now had some 18 years of competition to BT in one form or another. BT's continued dominance flows from its monopoly inheritance of a ubiquitous infrastructure and a captive customer base. Although competition, particularly from cable, is chipping away at this dominance, we would like to emphasise that we see no alternative at this time to continuing to maintain a considerable body of sector-specific regulation focused on BT in particular. This is particularly important given that BT is becoming adept at leveraging the dominance it enjoys in its traditional markets (eg access, residential voice) into new market sectors such as internet and broadband. There is simply no case for reducing the regulatory pressures on BT at this time—quite the opposite, in the case of key strategic issues such as local loop unbundling.

We urge the Committee to reject arguments for the large scale rolling back of sector regulation, which remains vital when applied to monopoly players

  It follows also that a clear distinction between sector regulation and competition law functions must be recognised and maintained. Oftel has tended over the last three years to increasingly apply competition law tests even when operating under sector specific regulation. But competition law exists to safeguard competition in markets which are not necessarily or inherently monopolistic. The very reason we need a sector regulator is that the same cannot be said for fixed telecommunications. Simply adhering to competition policy best practice will not be sufficient in many cases—it will be necessary to go beyond that to explicitly encourage market entry and nurture entry when it takes place.

The imbalance between economic regulation of platforms and content

  Much of the debate on OFCOM's economic regulation role assumes that this is simply the carry forward of oftel's existing role. This is understandable, given the almost complete focus of current economic regulation on networks and platforms, as opposed to services. However, it misses a fundamental point. The recent history of the broadcast sector highlights that it is ownership of key strategic content which confers market power. BSkyB has maintained a position of monopoly power in pay TV principally as a result of its ownership of key sports and movie rights. Similar problems will arise in the converged media of the future.

  However, as the Bill stands, platform operators with no market power at all will find themselves subject to burdensome ex-ante regulation whereas companies owning premium broadcasting rights, Intellectual Property Rights etc will escape relatively scot-free. BSkyB, for instance, is subject only to very superficial regulation of its conditional access services. The key issue of the terms on which its content is made available to rival distributors is not regulated under any sector statute, and is subject only to the most cursory scrutiny by the OFT.

  In considering this draft Bill, the Committee should reflect on whether this balance between platform and content regulation as it stands is correct. Customers continue to suffer from "rights wars", which lead to content being offered exclusively on one platform only. In addition, some broadcasters are adopting proprietary technical standards, which make it difficult and expensive to re-author their content for different platforms, even though open interoperable standards already exist.

  If the Committee considers that BSkyB's construction of an unassailable monopoly in key rights is in fact a problem that OFCOM ought to have a role in policing if not fixing—it might wish to press the Government for clarification on how this could be brought about.

  The Government should clarify whether OFCOM will be able to look at content and carriage issues under (a) competition law, and (b) sector specific rules. The Committee should consider whether the absence of specific obligations on dominant content providers are needed on the face of the Bill.

Regulatory mechanisms

  Assuming that regulation can be focused on the right issues, the question then arises of whether OFCOM will have the tools for the job. We welcome tougher penalties for anti-competitive abuses. Also, the range of mechanisms and measures inherited from Europe, and set out in Chapter II, do provide a broadly appropriate "tool kit" for the regulator—at least as far as regulation of networks is concerned. Nonetheless, there are still some problem areas:

    —  processes for identifying and acting upon anti-competitive behaviour are simply too slow. OFCOM needs the power to impose interim measures where it is clear that an abuse is having a detrimental impact on the market. The legal tests for this need to be sufficiently robust that risk-averse Government lawyers are prepared to employ them;

    —  there needs to be a remedy for third parties where a delay on the part of OFCOM in relation to a particular complaint effectively means that OFCOM has refused to act. There needs to be a right of appeal—with scope for financial compensation—where the regulator fails to reach a conclusion on a reasonable timescale;

    —  there is a great temptation for a monopolist to play the regulatory process to its conclusion in order to buy time. Penalties need to be structured so as to discourage time-wasting and vexatious appeals; and

    —  appeals need to be restricted to prevent vexatious cases, and be carried out in a timely way. An initial "leave to appeal" procedure is required, along with specified timescales for conducting appeals.

Concurrent powers

  Not without reservations, we agree with the retention of Oftel's concurrent powers for OFCOM. One concern with this is that, as already noted, the application of sector rules and competition law are not the same—and this is prejudicing the application of the sector rules. Another concern is that, judging by the debate on OFCOM structure and functions to date, it has not been sufficiently recognised how legally and operationally separate the competition law part of OFCOM will need to be from the other functional areas of OFCOM. The Joint Committee may recall that there was considerable doubt raised at the time the 1998 Competition Act was debated. An important safeguard was included which stated that the sector regulators could only take their other objectives into account to the extent that the DGFT, with his discretion tightly circumscribed by the need to adhere to existing case law and decisions of the European competition authorities, could do so. This is a very important safeguard and we suggest that the Joint Committee considers recommending to the Government that this provision is carried forward into the Communications Bill. We also believe a functionally separate Competition Act team should be established in OFCOM, reporting to a board member with experience in competition law.

  However, the extent of the "waterfront" covered by the concurrent powers to be held by OFCOM is significantly extended as for the first time, broadcasting will be included (the ITC does not currently have concurrent powers). Given the multiplicity of conflicting objectives which OFCOM will face in respect of broadcasting, the risk of competition cases being considered on something other than the standard economic assessment is markedly increased. Therefore NTL would like to see the commitment to ensuring no inconsistency emerges between case law of OFCOM, OFT and Europe.

  NTL's experience of the Competition Act to date suggests that it is not the panacea some predicted. In particular, the exceptionally long gestation period of the OFT's investigation into BSkyB highlights one real problem in the practical application of competition law—that we may only reach a conclusion once the damage has been well and truly done.

  The application of concurrent powers should be focused on a limited number of core, strategic cases, and should be pursued against identified timescales.

Must carry rules

  The Government deserves no more than a half cheer in respect of the approach to must carry rules set out in the Bill.

  Although it is difficult to comment meaningfully on this issue when much of the detail is not included on the face of the Bill, it seems to us that the Committee should consider what policy objectives the Government is trying to achieve, whether the proposed rules would be appropriate to those objectives, and what would be the opportunity costs of this policy.

  What are must carry rules for? Must carry rules are intended to support public service broadcasting. NTL also supports public service broadcasting, which all other things being equal provides greater quality and choice for our customers. We have never been, for instance, against the inclusion of BBC1, BBC2, IVT1 and Channel 4 in the existing suite of "must carry" obligations.

  Are the proposed rules appropriate to deliver on this objective? At the moment there is little or no policy framework established to determine whether a channel should have must carry status. The steps taken in the Bill to at least start to delineate what PSB commitments would mean are welcome, but do not go far enough as they are not explicitly linked to the process whereby new commercial channels may be added to the list of must carry channels in the future. One important point here is that must carry status should be granted only where the channel itself contributes to the delivery of PSB. In other words, it should not be the case that a broadcaster can obtain must carry status for an entire suite of channels, no matter how commercially oriented, simply because that broadcaster provides regional programming on one of its channels.

  Rules governing commercial channels' eligibility for must carry need to be tightly linked to their contribution to PSB objectives. The implications of granting must carry status to BBC services needs to be explicitly considered in the process of determining whether a channel proposal should be eligible for licence fee funding.

  A separate concern is that the entire cable industry faces must carry obligations, which BSkyB (DTH platform) does not. The BBC (for example) has to purchase its own capacity on satellite, and then to add insult to injury, pay a significant sum of money to BSkyB for conditional access services. The net effect is that BSkyB does not face any capacity or rationing choices of the kind which cable faces, and additionally gets a large cash injection. At present levels of must carry obligation, this is patently inequitable. Were must carry requirements to expand significantly, the anomaly would start to become seriously damaging for cable.

  Must carry rules should be applied consistently to all platforms. All platforms should receive payments calculated on an equivalent basis for carriage of must carry channels.

  What would be the opportunity costs of must carry policy? Capacity on cable networks is finite. Additional must carry channels can only be carried at the expense of other services. The capacity which has to be set aside to carry one digital TV channel would, if allocated to broadband services, generate approximately £30 million per year.

  Must carry carries with it an opportunity cost: the Government should have a requirement, before imposing new must carry requirements, to explicitly consider the effect that this will have on the delivery of other services, including broadband.

THE FUTURE IS BROADBAND

  There was one disappointment in the draft Bill: the word Broadband hardly featured. Strikingly, for a piece of legislation designed for a connected world, in which broadband lies at its heart. Quite simply, broadband changes the rules. Broadband changes the way the internet works for us and is perhaps the most important single factor in creating a communicated Britain. Broadband achievement has been impressive. Following commercial trials at the end of 1999, today our customer base puts us in the lead in a market that Oftel recently pointed out has passed the 500,000 mark.

  The new policy environment needs to intensify support of the investment in access infrastructure, which NTL embodies, and recognise that this is a vital economic activity in its own right. Broadband access is more than just a passive enabler of content services—it is a fundamental building block of the UK's national infrastructure and key contributor to our international competitiveness. If a rapid and effective broadband market is to be realised further significant action will be required by government.

  However, Broadband policy presents significant and immediate challenges to government, industry and existing regulators. The Committee will, of course, be aware that the Government has set a target for the UK to be the leading broadband economy in the G7 by 2005. It is clear that, for this to be achieved, much work is needed over the next three years.

  And, we also consider that the broadband challenge—if this is taken to mean the continued expansion of network capabilities through the introduction of higher bandwidths—will continue beyond that point. Further investment in infrastructure will be needed and new services will need to be developed. So this is an issue which is likely to remain highly relevant throughout the predicted lifetime of this legislation.

  We recognise, and largely agree with the Government's view that many of the issues that must be addressed in order to meet this challenge are already being addressed via other routes. Nonetheless, the absence of any reference to broadband in the Bill is a puzzling omission.

  We are concerned that without explicit duties in respect of broadband, OFCOM will grant it a relatively low priority, whatever the rhetoric now. We note, for instance, the relatively low numbers of Oftel staff currently devoted to broadband projects. Of course, Oftel could reasonably argue that their duties do not permit them to allocate more staff to this issue given their existing functions and duties.

  We therefore ask the Joint Committee to consider recommending to the Government that OFCOM have a positive duty to promote the development of a competitive market for broadband access to the new digital services—this applies equally to infrastructure and services.

  It is important, however, to avoid a knee-jerk approach to broadband. Much of the public debate around broadband continues to assume that broadband is an abject failure, whereas there are now very encouraging signs of progress in the market, as a result of cable companies' aggressive pricing of broadband and BT's (albeit belated) response. We believe that an explicit duty should continue to encourage the competitive delivery of broadband as the primary means of developing the market.

  We suggest that OFCOM's duty should be to promote competition and investment in broadband services.

  A number of proposals are currently under consideration for expanding the footprint of broadband. It would be wrong to rule out innovative ideas for spreading broadband, such as aggregating public demand. Although leadership for such activities may rest elsewhere in government, OFCOM should be encouraged to work in partnership with other parts of government and ensure consistent policy approaches.

  OFCOM should have a duty to promote the widespread availability of broadband services, and to advise and assist government in the formulation of policies to achieve this objective.

OFCOM needs to focus on broadband content issues

  A key theme of our submission has been that convergence is already happening. In one important respect, however, the market remains nascent, and that is in the development of truly unique broadband content. However, we are in no doubt that this will be the next giant step in the development of broadband, and something which will start to happen right about the time that the Bill passes into statute.

  This presents two challenges:

    —  how to ensure that content rules stimulate broadband content development rather than chilling it; and

    —  how to ensure that a handful of players do not end up dominating the broadband content market.

  Nowhere are the challenges going to be more difficult than in finding an appropriate regulatory methodology for applying content rules—almost entirely devised with traditional linear broadcasting in mind—to content delivered via broadband. Whilst NTL would not advocate a free for all as regards broadband delivered content, it is clear that traditional regulatory mechanisms, such as top-down codes enforced through licences, will not work. They will simply drive content creators outside of the reach of the licensing regime.

  Self-regulation has to be the answer, but this does not mean no regulation. It means service providers should work to provide customers with the means to make educated choices and if need be, reject content which they do not wish their families to see.

  We have already commented on the need for effective economic regulation of dominant content providers. As regards broadband, there is a genuine window of opportunity, in that OFCOM could be in a position to act ahead of significant dominance problems emerging, using appropriate sector regulation—a luxury not available to the regulators when BSkyB was creating its dominant position in pay TV.

  At this stage, the key issue is to ensure that OFCOM is established with these challenges in mind. On the content regulation side, OFCOM appears likely to have a surfeit of people with experience of regulating linear broadcasting. But it needs content regulators who come from an internet and broadband background to balance the "broadcast" bias and ensure genuinely new and innovative thinking in this area. Equally, OFCOM will not start with a basis of expertise in the economic regulation of content, and this needs to be rectified.

  OFCOM should ensure that the content rules for broadband enabled services are light touch and appropriate for the medium.

  OFCOM should have a remit to address anti-competitive behaviour by rightsholders or dominant content providers, either refusing to supply content for broadband purposes or seeking to discriminate in the supply of broadband content in favour of their own distribution platforms.

June 2002


 
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