Politics

Regulation in the UK

In the UK, and in Europe, regulators are working hard to ensure that overlapping rules don't conflict.

by Marlon Schafer Consultant and CEO, Odessa Office [December 13, 2004]

Next up was Leach, from the UK. He talked a lot about the recent regulatory reform efforts in Europe. They were needed because the legacy framework was anti-competitive and therefore created a disincentive to invest in the market. Europe had very similar issues to southern Africa: diverse population base, a large number of relatively small countries, and great disparity between existing rule sets.

All of the different rules for each country made operating across borders very difficult at best, nearly impossible at worst. So Europe put together a group not unlike TRASA in order to deal with those main issues. It was very interesting, indeed, to listen to the way that they went about making changes, why changes were made, and what is expected from the changes.

Leach started out talking about satellite access. How there was more than one spot in Europe where one could move mere feet in any direction and touch up to four different countries. How is a company supposed to get a satellite to function one way on one channel in country A and do something different in B, C, and D? The rules were a mess.

Three goals were identified: De-regulate industry, enact pro-competitive regulation, and harmonized regulation.

De-regulation mainly focused on cutting down of red tape. Making the rules easier to understand and implement.

Pro-competitive regulation was a bit harder. Is competition always king? Turns out that the answer is "yes, and no". To quote from Leach's PowerPoint presentation: "In general terms, competition principles have a proven track record, including preventing anti-competitive behavior which distorts fair competition including abuses of significant market power."

However, getting the balance right is no easy task. How do you prevent the old monopoly from "cherry picking" customers from the new competitor(s)? How do you force (is that the right word?) the market to open up in such a way that new companies will want to, let along be able to, enter the arena?

Much time was spent on "market harmonization". Leach talked about how this would drive much larger economies of scale. Little things like having licenses last the same amount of time in all countries would greatly simplify the tasks of the operators while not significantly impacting regulators.

In Europe, they are moving toward more industry involvement with regulatory issues. The regulatory bodies are guided by the concept that getting the most for the least out to the consumers is the ultimate goal of any regulatory actions.

Leach is also working on a "one stop shop" approach. It's a fascinating concept. I'm still trying to get my arms around all that it means so please forgive me if I don't get this exactly right. Basically, once these new changes are all put in place an operator (or other industry segment) will be able to go to one website. From there he'll be able to choose the country that he needs information from, the technology he needs information about, and find/fill out any forms or applications that he needs to deal with. The goal is to make it easier to set up shop. Anything that can make it easier to do business will reduce costs and thereby benefit consumers.

Leach's group believes that these actions (among others) will lead to "infrastructure development, applications development, and education and training prospects." That sounds about right to me.

Building trust and overcoming prejudices will likely be the most difficult aspects, but they feel they can do it.