Report on activities of the President of UKE for 2009 - UKE

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Report on activities of the President of UKE for 2009

The President of the Office of Electronic Communications presents activities which contributed to the achievement of major UKE objectives pursued in 2009.The activities of UKE are however much more differentiated and the full text of the report attached reflects their complexity and scale.

The major objectives of the President of UKE for 2009 include, inter alia, stimulating competition in the telecommunications and postal markets, consumer protection, development of new products and technologies, reducing prices, increasing physical availability of services, promoting Poland as an investment-friendly country, supporting broadband networks roll-out.  Market needs prioritised activities related to investment in broadband Internet and putting regulatory relations with Telekomunikacja Polska SA in order by way of an Agreement concluded in October 2009.

The key role in development of modern IT services provided by means of Internet in the next few years will have the Act on supporting the development of telecommunications networks and services, also called the "super-law". In 2009, the President of UKE took the initiative to create this legal act and came up with its initial draft (Chapter 2 - Telecommunications services market, Delivery of the Digital Poland programme, page 17) to be followed by the legislative process led by the Minister of Infrastructure with the involvement of the President of UKE. The assumption was to eliminate barriers to investment, simplify procedures for obtaining construction permits and to lay down transparent legal grounds for self-government authorities to perform tasks in the area of telecommunications. The act adopted a year after granted self governments on various levels an important investment function in the telecommunications market, starting from passive network roll-out to the provision of services under the circumstances in which no commercial operator is interested to invest in the area of a given commune or district due to economic reasons. The purpose is above all to enable all users - also in rural areas - to have access to fast Internet, to increase line capacity and to bring prices down as a result of increased competition.
The "Maps of demand" made available on the UKE website in 2009 (Chapter 2 - Telecommunications services market, Maps of demand versus TP investment committments, page 33) show that there is still much to be done as regards demand for broadband Internet in Poland. Having launched the maps of demand, UKE received more than 40,000 submissions from people who would like to have access to fast fixed-line Internet. 

Part of the so-called "white spots" should soon disappear thanks to the Agreement concluded between the President of UKE and Telekomunikacja Polska SA (Chapter 2 - Telecommunications services market, Implementation of an Agreement between UKE and TP, page 20).  The Agreement, signed in October 2009, is a chance to conclude a "regulatory war" that has been ongoing in the Polish market for many years already. It also has an investment dimension since Telekomunikacja Polska committed itself not only to perform regulatory obligations imposed on the company in a proper way and to observe the principle of non-discrimination towards other telecommunications operators, but also promised to create 1.2 million broadband lines with capacity exceeding 6 Mbit/s within 3 years, including 150,000 lines covering "white spots".  

Where TP, alternative operators or self-governments decide not to invest, Internet access can be provided by beneficiaries of the 8.4 measure "Last mile" in the Innovative Economy Operational Programme (PO IG). UKE collaborates with the Ministry of the Interior and Administration, which is responsible for implementing this measure, in the assessment of projects submitted by small and medium-size companies that intend to invest thanks to EU funds. Within the framework of a Systemic Project UKE will advise and coordinate measures related to broadband Internet financed from the PO IG under the measure 8.3 "Counteracting Digital Exclusion" and from regional operational programmes (Chapter 2 - Telecommunications Services Market, Supporting activities related to broadband Internet access, page 15).

The actions of the President of UKE connected with the frequency management, including 2.6 GHz, will also enable to increase the accessibility to the broadband Internet. After the disposal of the 3.5 GHz and 3.7 GHz bands and starting a number of tenders for the bands of 5.9 GHz, 10 GHz and 28 GHz in October 2009, the results of the tender for reservation of frequencies from the spectrum of 2570-2620 MHz throughout the country (Chapter 4 - Management of the frequency spectrum, The management of the frequencies of the 2.6 GHz band, p. 71). They are designed to provide telecommunications services in the broadband mobile wireless network. On 10 November 2009 the President of UKE issued a reservation decision for the Aero2 company. What is important, this entity bound itself to provide free access to the Internet network with the use of at least 20 per cent of the network capacity within the timeframe from the beginning of the usage of the frequency until the 36th month after achieving the 50 per cent threshold of the population coverage on the tender area. This network will be open for unlimited number of users, similarly to WiFi access points, the so-called hotspots. Making the rest of the 2.6 GHz band accessible is planned for 2010. For this purpose, the first frequency auction in Poland is being prepared.
The year 2009 was also important to consumers. The President of UKE has analyzed the applied charges for the "number portability" services on the Polish market, which resulted in changes in regulations governing the exercise of this service. In July 2009 the amendment of the Telecommunications Law and the Ordinance of the Minister of Infrastructure came into force. Based on this, the telephone users achieved a right to port their telephone number to another network quickly and for free (Chapter 2 - Telecommunications services market, Number portability, p. 28). As a result, in 2009 the number of people choosing the offer of another operator which was more advantageous for them and porting their number, increased almost twice in comparison to the year 2008. 

In 2009 the construction of the Location and Information Platform with a Central Database (Platforma Lokalizacyjno-Informacyjna z Centralną Bazą Danych, PLI CBD) has started (Chapter 5 - Management of the frequency resources, Location and Information Platform with a Central Database /Platforma Lokalizacyjno-Informacyjna z Centralną Bazą Danych, PLI CBD/, p. 74; Chapter 9 - Internetional cooperation, Projects co-financed from the EU budget, p. 158). This project, co-financed by the European Union, aims to facilitate the functioning of the system designed to obtain information on the localization of the subscriber calling for help and to facilitate the process of number portability. PLI CBD will be an important link of the informing emergency system covering inter alia 112 emergency number. This system will be also used to facilitate the number portability. The mobile phone users got from the President of UKE the important tool helping in assessing the quality of the network they use. In 2009 the UKE control services ran the tests of the 1800 and UMTS networks in four cities: Cracow, Łódź, Olsztyn and in Warsaw (Chapter 6 - Telecommunications controls, Quality tests of the GSM 900/1800 and UMTS networks, p. 89). The measurements of the mobile network coverage, the transmission quality and the voice quality were performed. The results were presented on the coverage maps published on the UKE website. In 2010 the tests will cover the rest of the voivodship cities.
The President of UKE fulfilled her tasks of the forming of the relations between operators (Chapter 2 - Telecommunications services market, Cooperation between operators, p. 35). On 9 December 2009 the President issued three decisions regarding adjustment of the telecommunications access charges with respect to the termination rates in the public mobile telephone network of Polkomtel and PTK on the level of 0.1677 PLN/min. As a result the retail charges for telecommunications services were decreased.

Additionally, as an effect of the Agreement with the TP and the establishment of the new rules of regulating wholesale charges through testing their relation with the retail charges, the President of UKE worked out the detailed methods of performing the margin squeeze test with regard to wholesale services and the price squeeze test with regard to retail services (Chapter 2 - Telecommunications services market, BSA offer and MP/PS tests, p. 39). This tool will allow assessing whether the charges for wholesale services provided by the TP enable alternative operators to create and introduce of the retail offer competitive to TP retail offer.

With relation to the problems in cooperation between TP and the alternative operators, which exist on the Polish markets of the IP traffic exchange, on 18 November 2009 President of UKE started the procedure of regulation of the IP traffic exchange markets. The President of UKE determined these markets as: the market of the provision of the traffic exchange service - peering with the TP network, and the domestic market of the provision of the traffic exchange service - transit.

As a result of the performed analyses the President of UKE decided to appoint the Telekomunikacja Polska as the entity of the significant market position on both of the abovementioned markets. The President of UKE prepared and put to the consultation two projects of the decision regarding these specific markets (Chapter 2 - Telecommunications services market, Analyses of the specific markets and imposing regulatory obligations, p. 47). Admittedly, as a result of the veto put by the European Commission in 2010 these were not established, however, under the pressure of the regulator the TP lowered the charges for access to its IP network and established technical rules of access to its network.

The year 2009 was supposed to be a breakthrough for the process of introduction of the digital video broadcasting - television. The President of UKE prepared a technical plan of the network of the first three multiplexes and issued two decisions: regarding the third multiplex designed for the public television and the first multiplex on which currently broadcasted analogue programmes of TVP, TV Polsat, TVN. Polish Media and TV Plus shall be placed (section 3- Radiodiffusion, Implementation of DVB-T, page 58). Unfortunately, as far as TVP prepares itself to activate MUX3 the decision on first multiplex has not been realized yet.  It was found that there is contradiction in public and private broadcasters' interests appearing among other things as lack of agreement on the method to select technical operator of MUX1. The negative effects of such situation are moderated by temporary licenses for experimental broadcast of digital TV in Warsaw, Poznań, Rzeszów, Zielona Góra, Żagań, Wisła and Rajcz.
The digitalisation of TV means also digital mobile TV. In March 2009 the President of UKE announced the results of beauty contest for frequency licenses in 470-790 MHz frequency band designed for the provision of audiovisual media services in DVB-H as recommended by European Union. The winner of abovementioned beauty contest was Info-TV-FM, which has already begun provision of wholesale services subject to assigned license. 
In February 2009 the President of UKE introduced the regulatory strategy on postal services market (section 8 - Postal Services Market, The Regulatory Strategy in the Scope of Postal Services Market for Years 2009-2011, page 105). The main goals of regulatory activities in years 2009-2011 are to prepare to full market liberalization. Therefore, the work on creation of legal conditions for harmonized development of postal market has already begun and also for equal and fair competition that shall be in force due to governmental decision from 2013. UKE took part in works on new postal law adjusting national law to requirements of  the Directive 2008/6/EC of 20 February 2008 amending the Directive 97/67 EC concerning the full implementation of  internal market of postal services in EU (so called third postal directive) and improving some of  regulatory activities.

In January 2009 the President of UKE raised an objection to universal postal services price list, among other things in the part concerning the unregistered economy and priority mails.  It has resulted in the decline of prices of priority mails from 2,10 to 1,95 PLN.  The decline of prices for priority mails influenced on decline of burdens in access do provision of postal services in the area reserved for other operators (section 7 - Postal Services Market, the Objection to Universal Postal Services Price List, page 109). 
In 2009, by implementing the European Commission's Recommendation the President of UKE designated two numbers (out of three indicated in the decision: 116 helpline numbers that have social value: 116 000 the European hotline number for missing children and 116 123 the European emotional support hotline (section 5, Number Resources Management, Numbering in the Scope of 116, page 75). Poland is currently in the group of EU members that has already activated all three social value numbers indicated in the decision (the 116 111 number - global child helpline - was activated in year 2008).

In year 2009 the works on creation of National Automatic System for Radio Spectrum Monitoring (KASMON) the system that manages and monitors electromagnetic spectrum, which has been started in 2008 have been still in progress. The works that have been undertaken shall end with creation of instruments, which shall ensure full control of technical parameters of all radio emissions. The KASMON system shall ensure remote monitoring of services of radio spectrum to the performance of measurements and direct access to its results (section 6 - Telecommunications' Monitoring, the Creation of National Automatic System for Radio Spectrum Monitoring).

The report is available in Polish in the attached file.

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