Opinion of the Economic and Social Committee on the 'Proposal for a European Parliament and Council Decision on the coordinated introduction of mobile and wireless communications (UMTS) in the Community'
Date: 1998-04-29
Institutions: European Economic and Social Committee
Subjects: EU policy, new technology, radio telecommunications, standardisation, telecommunications industry, trade licence

C 214/92

EN

Official Journal of the European Communities

10.7.98

Opinion of the Economic and Social Committee on the ‘Proposal for a European Parliament
and Council Decision on the coordinated introduction of mobile and wireless communications
(UMTS) in the Community’

(98/C 214/25)

On 24 March 1998, the Council decided to consult the Economic and Social Committee, under
Article 198 of the Treaty establishing the European Community, on the above-mentioned
proiposal.

The Section for Transport and Communications was instructed to prepare the Committee’s
work on the subject; it set up a study group and appointed Mr Mobbs as rapporteur.

At its 354th plenary session (meeting of 29 April 1998), the Economic and Social Committee
appointed Mr Mobbs as rapporteur-general and adopted the following opinion by 65 votes
with 1 vote against.

1.

Introduction

1.1.
Such is the speed of technological developments
and the pressure from the mobile telephone market for
a Community UMTS policy that the Commission has
submitted three papers within the space of less than a
year on the third generation of mobile phones UMTS ().

1.2.
The first Commission communication () was a
report on the further development of mobile communi-
cations. The second Commission communication () was
a synthesis of comments and contributions of all those
who had responded to the first communication. The
Committee adopted one opinion on both communi-
cations in December 1997 (). Generally, consensus
emerged from all consultations that Commission pro-
posals would help create favourable conditions for the
development of UMTS and thus help to serve the
needs of European consumers and to preserve the
competitiveness of European industry.

1.3.
The first generation of mobile phones (analogue)
is being supplemented by the second generation (digital)
where the European GSM () which has become the
widely accepted standard for mobile communications
with over 200 operators (in over 110 countries) running
or building a network, the majority of them outside
Europe.

(1) Universal Mobile Telecommunications System (UMTS).
(2) Communication to the European Parliament, the Council,
the Economic and Social Committee and the Committee
of the Regions on the further development of mobile and
wireless communications — Challenges and choices for
the European Union — COM(97) 217 final , 29.5.1997.
(3) Communication from the Commission to the European
Parliament, the Council, the Economic and Social Com-
mittee and the Committee of the Regions — strategy and
policy orientations with regard to the further development
of mobile and wireless communications — Outcome of
the public consultation and proposals for creating a
favourable environment — COM(97) 513 final, 15.10.1997.

(4) OJ C 73, 9.3.1998, p. 109.
(5) Global System for Mobile (GSM).

In its December 1997 opinion, the Committee
1.4.
noted that Europe’s success in launching and establishing
the GSM system could be ascribed to the timely
and adequate coordination and cooperation between
industry and the EU public authorities. The Committee
urged the adoption of an equivalent approach to the
issues attached to the transition to UMTS. This is
important when considering that the EU market for
cellular mobile services including UMTS is expected to
reach by 2005 over ECU 100 billion annual revenues
(according to the Commission and the UMTS Forum).

1.5.
UMTS is the European concept for the third
generation of mobile communications. It will offer users
a wireless access to the Internet and other multi-media
services in addition to the mobile telephony and mes-
saging services available today. The inclusion of satellite
capabilities will be of particular importance not only in
advanced societies but also in sparsely populated regions
and developing countries.

1.6.
Against this background the Commission pro-
poses a Decision to be adopted on the coordinated
introduction of mobile and wireless communications
(UMTS). Whilst there is broad recognition that develop-
ment must be market-led in order to facilitate investment
and innovation, it is necessary to create, within the
legal certainty that
existing regulatory framework,
licenses will be awarded and spectrum made available
in good time.

2. Commission proposal

2.1.
The explanatory memorandum to the Com-
mission proposal provides a very clear and concise
introduction to the overall proposal. The following
summarizes some of the key points.

A strong home market in Europe will provide
2.1.1.
the best conditions for European industry to compete

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on the global market and consolidate the leading position
which it holds with GSM.

2.1.7.
The timely availability of frequency spectrum
is a prerequisite for the introduction of UMTS services
in the Community. The timetable (Annex II) highlights
this for spectrum allocations identified by the CEPT.

2.1.2.
Adoption of the proposed decision will prove
the political determination to make UMTS a success
and will provide for the requisite legal certainty to
industry. Member States and their regulatory authorities
will have to ensure the harmonization of national
licensing procedures and the granting of licenses and
authorizations for UMTS. The proposed decision estab-
lishes a procedure to foster the licensing process building
on cooperation with CEPT/ERC (), CEPT/ECTRA ()
and ETSI ().

2.1.3.
The need for a common, open and inter-
nationally competitive standard for the UMTS radio
interface has been stressed by all Community insti-
tutions. The industry/ETSI consensus of 29 January
1998 also reflected this need. The technical specifications
will now need to be defined, in view of ETSI’s adoption
of the final UMTS standards. This agreement should
position UMTS as a key element of the International
Mobile Telecommunications (IMT 2000) family of
standards which is currently in preparation at the ITU ()
for implementation in the year 2000.

2.1.4.
conditions of application of existing legislation,
particular the Licensing Directive (97/13/EC).

Action is required to clarify without delay the
in

2.1.5.
Action is also required to ensure the harmoni-
zation and rapid introduction of compatible UMTS
services to secure Europe-wide roaming of Community-
wide and pan-European services. 1 January 2000 is
proposed as the date for the establishment by Member
States of authorization procedures which are necessary
for the introduction of UMTS. The provision of UMTS
services in Member States should be allowed as from
1 January 2002. The proposed decision establishes rights
and obligations on commercial players to negotiate
international roaming.

2.1.6. Whilst the components of UMTS have still to
be defined, the characteristics contained in Annex I
reflect the common understanding on UMTS by all
actors consulted.

(1) European Conference of Postal and Telecommunications
Administrations (CEPT); European Radiocommunications
Committee (ERC).

(2) European Conference of Postal and Telecommunications
Administrations (CEPT); Committee of European Tele-
communications Regulatory Authorities (ECTRA).

(3) European Telecommunications Standardization Institute

(ETSI).

3. General comments

The Committee congratulates the Commission
3.1.
on the speed of its actions in connection with UMTS
where the need to capitalize on Europe’s success of GSM
is paramount. A clear and stable regulatory framework
is needed to enable development to proceed which will
advance European mobile and wireless technologies.

The Committee welcomes the proposed decision
3.2.
and endorses the Commission’s objective of facilitating
the rapid introduction of UMTS. UMTS will be
developed taking into account the existing GSM plat-
form. The GSM systems will not become redundant and
the currently proposed developments for GSM will last
for years.

The Committee is particularly pleased to read in
3.3.
the explanatory memorandum that the Commission
expects that ‘UMTS should lead to the creation of tens
of thousands of new jobs in the Community’. However,
the Committee would like to see evidence to substantiate
this welcomed forecast.

The date for full

liberalization of telephony
3.4.
(subject to some derogations) on 1 January 1998 has
passed. Whilst the Commission achieved its objective
of having in place all the rules and regulations for
liberalization by the required dates, their implementation
by all Member States is far from complete. The Com-
mission’s ‘Third report on the implementation of the
telecommunications regulatory package’ () highlights a
number of areas where progress is far from satisfactory,
in fact legal proceedings are being undertaken in a
number of instances.

3.4.1.
Some of the unsatisfactory areas relate to
mobile telephony. This indicates that progress on
telephony (fixed or mobile) liberalization varies from
one Member State to another. This could be a problem
as there may well be difficulties in implementing to
schedule and to the same extent and time, the various
actions contained in the Commission’s proposed
decision.

(4) International Telecommunications Union (ITU)

(5) COM(98) 80 final.

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4. Specific comments

4.1. Article 2 — Definition — characteristics of UMTS

The Committee agrees that UMTS should be defined
with reference to the capabilities of the system, which
need to be distinguished from the services that may
be provided. In particular, the definition should be
market-led and its components should be determined by
the market, in the light of developments in technology
and consumer needs. By including in Annex I a list of
the essential components of UMTS, there is a risk
that the characteristics of UMTS contained in the
Commission’s proposal may prove either not to be
required by consumers or, alternatively, insufficient.
The Committee recognizes the need to list the elements
of UMTS but it should be made clear that what UMTS
will comprise will be decided by the market. Annex I
should contain a minimum set of characteristics of
UMTS for its initial stage of introduction.

4.2. Article 3 — Coordinated authorization

4.2.1.
The Committee recognizes the need to have a
date for the completion of the harmonization of national
licensing procedures to create certainty about the intro-
duction of UMTS. This should not restrain those
Member States which may be able or simply want to
proceed with the introduction of UMTS earlier than
others.

4.2.2.
The timetable set out in Annex II concerns the
harmonization of the frequency spectrum which is
necessary for UMTS. This timetable should be respected.
Authorizations for UMTS new entrants should take into
account the need to achieve compatibility of UMTS
systems at a European level.

Brussels, 29 April 1998.

4.3. Article 4 — Roaming rights and obligations
There is also reference to roaming in Article 3 —
‘Member States shall ensure that licenses support roam-
ing throughout the Community’. However, Article 3
does not make clear whether the Commission intends
that only cross-border roaming should be negotiated
between UMTS operators or that the same rights and
obligations should apply to roaming within a Member
State. The Commission’s intention should be made
clear.

4.4. Article 5 — Cooperation with CEPT
CEPT harmonization of UMTS frequency spectrum use
and conditions is essential for Europe’s success in
establishing UMTS as the world leading standard.
Accordingly, the Committee considers that there should
be the possibility, at national level, to proceed at a faster
pace towards regulating the use of frequencies and the
conditions of authorizations without compromising the
CEPT harmonization work. The successful introduction
of UMTS depends on addressing the requirements of
the market and administrative procedures should be
adjusted to achieve this objective. The Commission
should ensure, as soon as possible, that all necessary
steps are taken at a Community level in cooperation
with the relevant international fora (CEPT/ECTRA,
CEPT/ERC, ETSI) to achieve the timely allocation of
sufficient frequency spectrum for UMTS services.

4.5. Article 6 — Cooperation with ETSI
The Committee is pleased to learn of the progress
achieved recently at ETSI regarding the adoption of a
common and open air interface standard for UMTS,
which is known as UTRA (). All institutions involved
should make all necessary efforts to maintain the
momentum for the introduction of a common standard.
This will enhance the opportunities for the widest
possible acceptance of UMTS.

4.6. Article 13 — Report
The Committee requests that it is sent a copy of the
report.

(1) UMTS Terrestrial Radio Access (UTRA).

The President

of the Economic and Social Committee

Tom JENKINS