Notes from the 2008 CES International Supersession
Notes from the 2008 CES International Supersession
Notes from the 2008 CES International Supersession

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    One of the many panels at CES on Tuesday, January 8 featured a tricontinental group of communications policymakers: David Gross, United States Coordinator for International Communications and Information Policy; Viviane Reding, European Commission Commissioner for Information Society and Media; and Tsutomu Sato, Senior Vice Minister for Internal Affairs and Communications of Japan.

    Though the panel ended up more like a concurrent speech by each of the three policymakers, there was a clear tension between Gross's and Reding's points of view regarding both the best way to encourage broadband penetration and the roll out of TV on mobile devices. While Reding advocated broadband unbundling requirements as a means to stimulate competition, Gross expressed confidence in market forces alone to promote growth. Similarly, in the realm of mobile TV, Reding advocated a government-determined standard after years of waiting for industry to come to agreement, while Gross maintained that the longer process of industry deliberation would lead to more choice for consumers.

    Sato, speaking through an interpreter, largely kept out of the latent debate, though he noted early on that unbundling regulations (which require incumbents to lease the use of lines to competitors) and colocation rules were a major reason for Japan's current high-speed, low-cost broadband services. Sato noted that the average cost of broadband in Japan was $35 a month, while fiber to the home would cost the average Japanese consumer around $50 a month.

    Reding also emphasized that competition has been a major factor in placing European countries at the top of the OECD's broadband penetration rankings, specifically noting that the EU's broadband leaders are distinguished from its “laggers” in that the former have seen more competition with unbundling regulations. She proposed that Europe should not measure itself by looking only at its largest countries, but on the continental level, where different solutions might be needed in different contexts. For instance, wireless solutions might work better in rural areas than fiber rollout, and in countries where competitive forces might not create enough deployment, EU funds might be used to that end.

    Gross began by noting that the standard US talking point here was to criticize the OECD numbers, while others would normally note that the US's standard for what constitutes broadband is, at 200 kbps, far too slow. He took this opportunity, however, to note that the definitions of broadband speeds are constantly changing. As an example, he mentioned this morning's announcement by Comcast that it will have 160Mbps service in the next few years. He defended the current level of US penetration, noting that there are diverse geographic issues to be dealt with in laying fiber to homes in the US.

    Each of the panelists also weighed in on wireless spectrum policy, including mobile broadband and mobile TV.

    Sato noted that recently, the 2.5 GHz band was allocated for wireless broadband use in Japan, with the commercial operators needing a little under a year to roll out services.

    As for mobile TV, Sato mentioned that Japan currently has designated one segment of its digital terrestrial broadcast band to deliver content to mobile devices. 15 million mobile phones on the market that have this capability. An important next step, he said, was reallocating additional spectrum for wireless broadband, and said that Japan's transition from analog to digital broadcast in July 2011 should free up that spectrum. Even though digital broadcasts in Japan began in 2003 and 93% of consumers can receive the signal, he said, getting the remaining percentage ready for the shift will take some time. Noting the various systems, technologies and applications on display at CES, Sato said that his ministry had formed a working group to determine what systems and technologies to use.

    Reding, noting the extremely high mobile penetration in Europe (with more phones than people in the average EU country), was particularly excited about the possibilities for mobile broadband. However, she emphasized that content was the main driver for consumers to take up new forms of connectivity. She referred back to her recent communication on online content, which calls for more online content offerings through easier, Europe-wide licensing agreements, DRM interoperability and informed consumers, and a balance between piracy enforcement and increasing legal online content options.

    As for spectrum allocation, Reding noted that many EU countries had already switched over to digital, though some were still in the process, and some would lag behind. She viewed her job as pushing those laggers to make the switch to free up spectrum, emphasizing the long-term costs to delay. She also noted that in reallocating spectrum, the policies must be technology- and service- neutral, and include aspects like unlicensed spectrum.

    On mobile TV, Reding vehemently supported European adoption of the DVB-H standard, noting that it is an open, transparent system that is compatible with the DVB-T system. When questioned about how this fit with her technology-neutral stance, Reding stated that industry hadn't come to agreement on a standard itself, and that in order to prevent costly delays, DVB-H, with its noted advantages, should be used. She cited the success of Europe deciding to adopt the GSM mobile phone standard as an example. By designating a system from the top down, industry benefited from certainty and continental interoperability.

    Gross disagreed with this approach, noting the wide variety of technologies that can be used for wireless content delivery on display at CES. Competition between platforms as these technologies evolve, he said, would produce the best results. Gross defended the US's hands-off process in selecting its second-generation mobile phone standard (as opposed to Europe's GSM adoption) by saying that the US is now better poised to adopt the third generation. The various ways of delivering video content, from more traditional broadcast means, to more IP-based means, would lead to competitive innovation.

    Gross noted that the US's digital transition, slated for February 2009, was not the only case of spectrum reallocation. He said there were numerous examples of reallocating spectrum from defense and video uses to commercial uses in past years.

    Gross also noted the global nature of online content, and that not only did this mean that we have access to the world's content, but that content producers must have a truly global market. He noted the several discussions on development and technology to take place here at CES on the 9th.

    I'm planning on attending those sessions, and hope to provide something more than rough notes from those, as well as additional commentary on Reding's plan for content.