Telecommunications infrastructure, IT services and the entertainment industry are becoming ever-more intertwined, and this convergence presents challenges not just for the industries concerned, but also for European regulators. So says the E.U.'s top policy maker for the IT and media industries, Viviane Reding, in an interview with IDG News Service. She talks about how the film industry, telecommunications operators, IT researchers and regulators across Europe are responding, and about the effect these actions will have on citizens, whether they be movie buffs, car drivers, hospital patients or library users.

On June 1, the European Commission will unveil a five-year program to harness the opportunities of the digital economy and help the E.U. close the lead taken by the U.S. and Japan in this field. The program, i2010, aims to create the right framework for investment in the information technology sector, to boost the take-up of IT by consumers and businesses and deal with the increasing convergence between different technologies.

According to Reding, the author of the strategy, the purpose of i2010 is to unite all the different tools of policy making, including smart regulation and investment in research, to spread the digital economy's benefits, while encouraging different industries to work together for their mutual advantage.

Reding, the E.U.'s commissioner for the information society and the media, stresses that the increasing convergence between technologies such as television, the Internet and mobile phones means that public authorities like the Commission have to respond to marketplace realities, especially as demand for services like films online grows in the E.U.

"We have to have policy convergence on infrastructure, content and services," she insists.

She highlights a meeting at last week's Cannes Film Festival, between telco chief executive officers and film production giants and European audiovisual ministers, as an example of the way forward.

Producers and distributors like this don't have a tradition of working together, Reding says.

"I said to them, you have seen what happened in the music industry," she says.

The Cannes meeting participants agreed that downloads are an additional distribution channel for filmmakers, she says, adding that another digital distribution channel, DVD, has boosted rather than reduced demand for films. The key, she argues, is ensuring that infrastructure and service providers and content makers all get a share of the new income generated by film online. To do this, effective and easy-to-use digital rights management technologies are needed to fight against piracy and ensure that content providers profit from the sale of their products, she says.

At the same time, consumers need to understand that they must pay for online products.

"We have to develop legal models which are attractive to young people," Reding says, adding that culture and audiovisual ministers agreed in Cannes on the need to educate the public about the implications of illegal downloading.

The Commission hopes that leading film and telecommunications companies will soon agree to launch a charter on sharing online film revenue.

Getting the legal framework right and ensuring that the two sides find workable solutions to revenue sharing will not just benefit producers of Hollywood blockbusters, she says: it can also help independent producers whose films are not distributed through traditional channels.

Reding cites the example of two sides of industry working together as evidence of the "joined up" approach behind the i2010 strategy, where better content choices can drive demand for improved infrastructure services such as greater broadband capacity. At the same time, improved capacity can entice consumers to download and watch films over the Internet.

While Reding wants to allow the market to determine which products and services are developed, she makes it clear that, as the overall regulator for the electronic communications sector, the Commission will intervene when necessary.

Taking the example of VOIP (voice over Internet Protocol) telephony, Reding says that so far she has pressured the national regulators to act: they have the initial responsibility for ensuring a level playing field for VOIP in the E.U.

"VOIP was at risk of being blocked by those who have the fixed-line market, so the first thing I did was to meet regulators and say I wanted them to act so the market wasn't blocked," she says. She highlights the fact that the German regulator has acted to tackle problems in the German market.
While Reding prefers to rely on national regulators for the time being, if VOIP barriers remain then she will step in, she says.

"I have confidence in the regulators. I leave them to the end of the year. If it hasn't happened I will come in," she says, adding that she prefers not to have a "top-down approach."

The number of E.U. VOIP services subscribers is relatively low at under 500,000 users, she says, compared to 4.9 million users in Japan and 1 million users in the U.S. She attributes this to the technology still being relatively expensive, especially for calls from a VOIP network to a standard fixed or mobile service provider.

An appropriate regulatory framework can also help other telecommunication services to market, and is a necessary adjunct to other moves such as increasing research and development (R&D) spending, she says.

The E.U. wants to double IT R&D spending to

» posted by abennett

IDG News Service

• Email
• Print
• Share
  • Slashdot
  • Digg
  • Stumble
  • Reddit
  • Newsvine