BEREC Report on Member States’ best practices to support the defining of adequate broadband internet access service

BoR (19) 260

This report is a requirement under Article 84(3) of the Directive (EU) 2018/1972 establishing the European Electronic Communications Code (EECC), which states that:

“BEREC shall, in order to contribute towards a consistent application of this Article, after consulting stakeholders and in close cooperation with the Commission, taking into account available Commission (Eurostat) data, draw up a report on Member States’ best practices to support the defining of adequate broadband internet access service […].”

Upon the transposition of Article 84 of the Directive (EU) 2018/1972, Member States (MS) shall, in light of national conditions and the minimum bandwidth enjoyed by the majority of consumers within the territory of that MS, and taking into account the BEREC report on best practices, define the adequate broadband internet access service for their territories with a view to ensuring the bandwidth necessary for social and economic participation in society. The adequate broadband internet access service shall be capable of delivering the bandwidth necessary for supporting at least the minimum set of services set out in Annex V of the Directive (EU) 2018/1972.

As such, this report examines how MS have introduced a broadband USO under the legislative framework provided for in Directive 2009/136/EC (amending Directive 2002/22/EC) which included “functional internet access” under universal service, to be determined by MS “taking into account prevailing technologies used by the majority of subscribers and technological feasibility.”[1] This report offers an insight into the practices of the nine MS (Belgium, Croatia, Finland, Latvia, Malta, Slovenia, Spain, Sweden and the United Kingdom) which have to date introduced broadband under a USO, however it is worth pointing out that these MS did so under the current legislative framework and not under Directive (EU) 2018/1972.

 

The key areas addressed in this draft report are:

- the policy principle - Article 84 of the Directive (EU) 2018/1972
- relevant experience that BEREC can draw on
- common principles with respect to bandwidth, evaluation, eligibility designation mechanism, quality of service (QoS), monitoring of compliance and affordability measures, universal service providers (USPs), and the nature of funding across MS that have introduced a broadband USO
- recommendations for future reports

This draft report contains the following Annexes:

- ANNEX 1 – “Glossary of terms” sets out the relevant glossary of the terms used in Article 84 (where provided in Directive (EU) 2018/1972, or European Commission, COCOM and BEREC documents), where they are associated with any broadband USO to date

- ANNEX 2 – ‘Relevant experience that BEREC may draw on’ sets out the specific documents and data references

- ANNEX 3 – Broadband universal service – nine MS

- ANNEX 4 – Common principles across MS that have introduced a Broadband USO – additional information and references

The report has been drafted in close cooperation with the European Commission, in particular with regard to the data sources referenced in the report.

In the development of this report, research was conducted on the nine MS which have previously introduced a broadband USO, in cooperation with and with the assistance of the National Regulatory Authorities (NRAs) of these MS. The report outlines a set of common principles which have been identified based on information provided by the NRAs of the nine MS with a broadband USO. No MS has implemented an adequate broadband internet access service USO under the new legislative framework established by Directive (EU) 2018/1972, and accordingly, adequate broadband internet access service best practices are not yet defined. In identifying common principles and detailing how the nine MS (Belgium, Croatia, Finland, Latvia, Malta, Slovenia, Spain, Sweden and United Kingdom) have to date (albeit under a different legislative framework) introduced a broadband USO, the report aims to contribute towards the consistent application of Article 84 by MS in the introduction of adequate broadband internet access service under universal service.

In accordance with Article 84(3), this report will be updated regularly, in order to reflect technological advances and changes in consumer usage patterns. Additionally, and as outlined later in this draft report, there are a number of other BEREC reports and work streams which are related to this report, and future updates may therefore be planned accordingly (see Section 5 of this document).

BEREC invites all stakeholders to submit their observations and contributions regarding this draft best practices report and to respond to the consultation questions that are set out in section 7. The public consultation is open from 11 December 2019 to 27 January 2020. Stakeholders are invited to submit their contributions via the BEREC online public consultation tool. The contributions can also be sent to the following e-mail address PC_Adequate_BB_IAS@berec.europa.eu by 17:00 CET 27 January 2020. The final report, following public consultation and taking into account the public feedback will be presented for adoption and publication at the BEREC Plenary 2 (June 2020).

The policy principle underpinning this draft report is to contribute to a consistent application of the provisions contained in Article 84 (paragraphs 1 and 3) of the Directive (EU) 2018/1972.

According to Article 84(1)[2] Member States:

“…shall ensure that all consumers in their territories have access at an affordable price, in light of specific national conditions, to an available adequate broadband internet access service and to voice communications services at the quality specified in their territories, including the underlying connection, at a fixed location.

Article 84(3) requires that that by 21 June 2020, BEREC shall:

“…after consulting stakeholders and in close cooperation with the Commission, taking into account available Commission (Eurostat) data, draw up a report on Member States’ best practices to support the defining of adequate broadband internet access service pursuant to the first subparagraph. That report shall be updated regularly to reflect technological advances and changes in consumer usage patterns.”

The objective of paragraph 3 of Article 84 is therefore to enhance consistency in the application of the USO with regards to ensuring “adequate broadband” IAS, defined by each MS in light of its national conditions, to end-users across all MS. Annex V of the Directive sets out the minimum set of services which the adequate broadband USO must be capable of supporting:[3]

1. E-mail

2. search engines enabling search and finding of all types of information

3. basic training and education online tools

4. online newspapers or news

5. buying or ordering goods or services online

6. job searching and job searching tools

7. professional networking

8. internet banking

9. eGovernment service use

10. social media and instant messaging

11. calls and video calls (standard quality)

Section 5.5 of the BEREC 2019 Work Programme[4] sets out the purpose of this report as gathering and analysing the relevant information, including:

- data available from the European Commission (Eurostat) regarding the availability and quality of broadband internet access service in MS;

- how to determine the bandwidth necessary for supporting the minimum set of services set out in Annex V of the Directive (EU) 2018/1972.

Following the amendment of Directive 2002/22/EC (on universal service and users’ rights relating to electronic communications networks and services) by Directive 2009/136/EC which introduced functional internet access under universal service, a number of reports were carried out by European bodies which looked at the inclusion of internet access under USO, examined the future scope of universal service and the possible future inclusion of broadband under USO. These reports and working documents were conducted by various European bodies such as BEREC, the European Commission DG Communications, Networks and Technology (“DG CONNECT”) and the Communications Committee (COCOM).

The various directives, reports, and surveys which BEREC and MS can draw upon in relation to the defining of an adequate broadband internet access service are listed in Figure 1 below. They are based on the current framework (“functional internet access”), but they may inform the definition of the adequate broadband USO by MS according to the new framework’s “adequate broadband internet access service.”

In 2011 COCOM issued a Working Document[5] to clarify Article 4 of the revised Universal Service Directive (Directive 2009/136/EC) in relation to the internet related aspects of Article 4. The aim of this working document was to facilitate the correct transposition of Article 4 and the consistent implementation by MS following the inclusion of the requirement that “Member States shall ensure that all reasonable requests for connection at a fixed location to a public communications network are met by at least one undertaking” (Article 4(1)) and “The connection provided shall be capable of supporting voice, facsimile and data communications at data rates that are sufficient to permit functional internet access” (Article 4(2)) within the scope of universal service.

In 2014 the Commission published a “Review of the Scope of Universal Service”[6] which examined the future of universal service and specifically looked at the inclusion of broadband under USO. The Review developed a methodology involving four ‘baskets’ of online services, with the primary basket of services addressing social inclusion and services used by the majority of consumers. The primary basket developed for the purposes of this review is comparable to and closely matches Annex V of Directive (EU) 2018/1972.

In 2017, BEREC conducted a survey of BEREC members on the implementation and application of the universal service provisions. This was then summarised in a report titled “The BEREC update survey on the implementation and application of the universal service provisions – a synthesis of the results,”[7] which provides an update to the previous 2014[8] report and presents an overview of the main findings of the survey carried out. The report synthesises the responses from a total of 31 NRAs, including four non-EU members. The report covers issues such as the designation of USPs, assessment of net costs, compensation mechanisms, assessment of unfair burden, assessment of the impact of US provisions upon competitive outcomes and measures NRAs have implemented on the affordability aspect of US obligations, such as retail price caps.

Recital 215 of Directive (EU) 2018/1972 refers to the Commission for monitoring and updating the list of online services used by the majority of end-users across the Union and necessary for social and economic participation in society:

“The affordable adequate broadband internet access service should have sufficient bandwidth to support access to and use of at least a minimum set of basic services that reflect the services used by the majority of end-users. To that end, the Commission will monitor the development in the use of the internet to identify those online services used by a majority of end-users across the Union and necessary for social and economic participation in society and update the list accordingly.”

Databases and reports such as Eurostat and Digital Economy and Society Index (DESI) are currently available online and contain data that could be used to monitor the development in the use of the internet with a view to identify those online services used by a majority of end-users across the Union and necessary for social and economic participation in society.

The European Commission has selected more than 100 indicators, divided into thematic groups, which illustrate some key dimensions of the European Information Society. These indicators allow a comparison of progress within and across European countries as well as over time.

BEREC in close cooperation with the Commission is of the view that the following European Commission data (set out at Figure 3) may prove useful. ANNEX 2 ‘Relevant experience that BEREC may draw’ on sets out the specific data references. This data may be supplemented by MS specific data.

In relation to the DESI data, MS should consider the “use of the internet” which is based on Eurostat data; “digital public services” (which is based on a separate report entitled “e-Government and benchmarking, Digital Single Market”);[9] the telecoms chapter of the DESI report (which specifically references USO) where relevant; and any MS specific policy insights and/or national data.

A set of common principles has been identified based on information provided by the NRAs of the nine MS with a broadband USO under the legislative framework provider for in Directive 2009/136/EC (amending Directive 2002/22/EC). These common principles may contribute to the consistent application of Article 84 of the Directive (EU) 2018/1972. These are now summarised, based on a benchmarking exercise undertaken of the nine MS who have already implemented a broadband USO.

Common principles in defining the broadband internet access were identified in the nine MS with respect to the following aspects:

- Definition of bandwidth

- Evaluation criteria

- Eligibility criteria

- Designation – procedures and scope

- Quality of Service

- Monitoring

- Affordability Measures

- Funding

A broadband USO was introduced in nine MS between 2010 and 2018 (either by the relevant Ministry or the NRA).

There is some variability in the current definition of minimum bandwidth amongst the MS analysed: three MS selected a minimum download speed of 1 Mbit/s, one MS selected 2 Mbit/s, two MS selected 4 Mbit/s and two MS selected 10 Mbit/s. Latvia is the only MS that has not introduced a minimum bandwidth broadband USO and has limited the scope of the broadband USO to disabled end-users and associated affordability measures only.

Some MS have set a minimum upload speed (Slovenia, United Kingdom) but the majority of MS have not.

Figure 5 below summaries the current speeds and the most recent year in which these speeds came or will come into effect.

Evaluation criteria

In setting a broadband USO data rate, four countries (Belgium, Croatia, Malta and Slovenia) have, among other criteria, based their assessment where the data rate in question is used at national level by:

i)at least 50% of all households; and

ii)at least 80% of all households with a broadband connection.

These criteria were guided by the practical application of Article 4 of the Universal Service Directive 2009/136/EC (“substantial majority of the population”) and as further outlined in the COCOM working paper of 2011.[10]

Belgium and Slovenia have also considered other criteria,[11] such as preventing significant market distortions and/or significant implementation costs, in determining the broadband USO. For instance, in Belgium, the application of the above mentioned criteria i) and ii) resulted in a maximum speed of 8.5 Mbit/s. However, BIPT was of the opinion that a nominal bit rate for functional internet access of 1 Mbit/s should be included. During its analysis, BIPT took into account, amongst other elements, the fact that setting a minimal speed that was higher than 1 Mbit/s might entail high costs.[12]

Below are the other criteria considered by MS, shown in order of prevalence: [13]

i) expected availability of broadband without public intervention[14] (Belgium, Croatia, Finland, Malta, Slovenia, Sweden, the United Kingdom);

ii) estimation of the cost of implementing a broadband USO (Belgium, Croatia, Malta, Slovenia, Sweden, the United Kingdom);

iii) geographic survey (Belgium, Croatia, Finland, Slovenia, Sweden);

iv) market distortion[15] (Belgium, Croatia, Slovenia, Sweden, the United Kingdom);

v) estimation of the potential demand for a broadband USO (Croatia, Slovenia, Sweden, the United Kingdom);

vi) comparison with other EU countries (Belgium, Croatia, Slovenia, the United Kingdom);

vii) benefits of public intervention and effects on competition (Belgium, Sweden, the United Kingdom);

viii) timeframe to make available broadband under USO (Croatia, Slovenia, the United Kingdom);

ix) social and economic disadvantages incurred by those without access to a broadband connection, including disabled end-users (Belgium, Croatia); and an

x) estimation of the costs of intervention through USO versus other approaches (Belgium).

These criteria reflect many of the criteria outlined in the COCOM working paper of 2011 to help MS to identify specific social and economic objectives and desired outcomes (see Figure 6 outlining the evaluation criteria used by the MS which have introduced a broadband USO).