Tomorrow's internet business models: the need for fair platform competition

18 November 2010 Author: EIFonline

Gavin Patterson, CEO of BT Retail spoke at the EIF breakfast debate on 18 November. Although applauding the re-launch of the EU27 single market, the Digital Agenda, the drive on Open Trade and the so-called Innovation Union, Mr. Patterson also made a passionate plea for ensuring a fair balance between market competitors and avoiding preemptive regulation.

Mr. Patterson believes that platform competition will deliver economic growth and that jobs will come from this competition. As such, he highlighted a couple of cases where he believes that fair competition is lacking. For instance, BT at the moment is hampered by not getting fair wholesale access to Sky premium film and sports channels, something BT deems critical to have a competitive offer in the (UK) marketplace. At the same time, Sky can access all of BT's broadband and copper networks and bundle it with content services. This is something that limits consumer choice at the best rate possible. 

At the same time, BT is creating a new mass-market channel called YouView, an open standards network that allows TV to be delivered over broadband. Open standards refers to the fact that all content providers can provide content over this network. BT is working with ITV, the BBC, Channel 4 and many other companies to make this network a reality. UK telecom regulator Ofcom is helping to open markets to some extent, but not sufficiently in the words of Mr. Patterson.

Shifting from competition to social media, Mr. Patterson emphasized that user generated content channels like Facebook, Twitter and YouTube, and the enabling technologies such as cloud computing, need nurturing and promoting. At this stage these services can do without heavy regulation. Of course there is a need for a common set of consumer protection and privacy standards, but within that framework one should let the market decide. The review of the data protection regulation in the EU would be a welcome opportunity to get things right in this area.

In his concluding remarks Mr. Patterson called for open access to the Internet, no discrimination and improved transparency across Europe for all market players, without putting rules in place that stifle competition.


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