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Consultation document April 2000 Chapter 1 Introduction Chapter 2 Market developments Chapter 3 Key themes and trends in the new environment Chapter 4 Competition policy and regulatory approach Chapter 5 Initial findings and preliminary conclusions Annex A Other relevant studies Annex B List of first round consultees Annex C List of questions Annex D Bibliography S1 In 1999 the Prime Minister commissioned the Performance and Innovation Unit (PIU) to identify a strategy for achieving the Government’s aim of making "the UK the best environment in the world for e-commerce". In its report e-commerce@its.best.uk the PIU asked OFTEL and the OFT "to carry out a review to identify whether there are emerging barriers to competition in electronic markets and make recommendations for preventing these from becoming serious problems". S2 This study follows from the PIU recommendation and aims to identify potential barriers to competition in e-commerce in order that market entry does not become foreclosed and that both business and consumers benefit from a competitive market offering wide choice and efficient prices. S3 At present most retail e-commerce is transacted using a PC modem and standard telephone line. But alternative means of getting on-line are developing all the time. For example, on-line shopping is already available over digital satellite and cable TV. It is expected that mobile phones will become widespread as a delivery mechanism for electronic commerce and this will be further enhanced by the new generation of mobile technology which comes in from 2002. Speed of access will also increase with the introduction of technologies such as Digital Subscriber Line (DSL), cable modems, broadband fixed wireless and satellite. In looking at the developing technology it is important to consider not only the delivery networks and access devices, but also the technology that is needed to deliver content to the end user. S4 The likely outcome of future developments of this kind will be to deliver an increasingly innovative array of services to consumers and give consumers increased choice as to how they receive services. These technological changes are also likely to affect the way markets interact as companies evolve to exploit new e-commerce opportunities. S5 The current environment is characterised by the existence of a large number of Internet Service Providers. Open standards have enabled the development of a large number of content and e-commerce providers. But this may change over time. An examination of emerging technologies and discussions with industry suggest that issues of vertical integration, convergence, and expansion and consolidation in the industry, will be central to market development. S6 Whether competition issues arise depends on the way in which the market develops and the way in which any particular company responds in that market environment. While it would be premature to identify specific problems at this stage of our study, we have earmarked a number of areas for particular consideration. These include the move towards achieving network efficiencies in the delivery of Internet access, potential concentration in the IP backbone market, the development of new higher bandwidth mechanisms and the increasing popularity of devices other than the PC for accessing interactive services. Competition issues may arise where there are players with significant market power and the capability to affect the competitive landscape. Competition issues in the new marketplace however, are not likely to differ fundamentally from the kind of issues that regulatory authorities are already facing. S7 OFT and OFTEL believe the primary role of regulatory and competition authorities is to promote the interests of consumers – that is to ensure consumers have choice and value for money when purchasing products and services. This is mainly achieved through preventing anti-competitive behaviour and promoting competition in circumstances where it is not yet effective. This study therefore focuses mainly on these two activities and examines: the role of regulatory and competition authorities in fast moving markets; whether the established competition policy tools and the current institutional structure will allow for issues in e-commerce to be dealt with effectively; and the powers OFT and OFTEL would have to address these issues if they emerged and how these might be used. S8 OFT and OFTEL do not accept that there would never be a need for intervention in e-commerce markets, but do accept that inappropriate intervention or intervention with only short term goals in sight could be damaging to competition over the long run. While regulatory action may be necessary to protect competition and encourage the development of competition where it is not effective, inappropriate regulation can distort markets and affect the direction a market takes. It is also important to ensure that in taking regulatory action, incentives to invest are not undermined. S9 But the fact that additional considerations need to be taken into account does not preclude action from being taken when necessary to prevent anti-competitive behaviour which would have the effect of stifling innovation. While none of the developments identified in this study would in themselves necessarily be considered undesirable, as in other markets problems may arise where a player with market power extends its position into adjacent markets or abuses its position by restricting access to, or charging excessive prices for, essential services. S10 Abuse of market power in a fast-developing market could, if left unchecked, have a wide-ranging impact on the market in a relatively short space of time. Thus where there is a need for action to correct any anti-competitive behaviour the timescale for assessing the case should reflect the pace of the market. Equally, market power in fast-developing markets might be short-lived, so care is needed when considering regulatory action. S11 OFT and OFTEL consider that the current general regulatory framework in the UK, based on European Commission principles, and centred on the Competition Act, with additional specific powers granted under the Telecommunications Act and the Fair Trading Act, is sufficiently generic and technology-neutral to enable future e-commerce cases to be dealt with satisfactorily. Reviews are being conducted by the UK Government and the EU (to which both OFT and OFTEL are contributing) to address any discrepancies that are present in legislation. But we are very interested to know the views of small business, industry and consumers on the range of issues raised in the following pages.
Introduction 1.1 E-commerce is revolutionising the way people do business and exchange information. It has encouraged the entry of new players into established markets and has facilitated the opening of national boundaries allowing retailers to establish global storefronts providing the potential for a wealth of additional choice for consumers. But this is just the beginning of the e-commerce ‘revolution’. New high speed access mechanisms will make e-commerce more attractive, and the emergence of new devices promises to bring online services to sections of the population that have not had access before. 1.2 For consumers and businesses to gain the full benefits of this new electronic global marketplace it is important that the environment in the UK allows the development of these e-commerce services and enables consumers to access them in the most efficient way. Ensuring that the market remains competitive and guarding against barriers to innovation is key to achieving this aim. 1.3 Early last year the Prime Minister commissioned the Performance and Innovation Unit (PIU) to identify a strategy for achieving the Government’s aim of making "the UK the best environment in the world for e-commerce". The PIU published its report e-commerce@its.best.uk in September. One of its 60 recommendations was for OFTEL and the OFT "to carry out a review to identify whether there are emerging barriers to competition in electronic markets and make recommendations for preventing these from becoming serious problems" (see recommendation 7.1 page 30). This study aims to identify potential barriers to competition in e-commerce in order that market entry does not become foreclosed and that both business and consumers benefit from a competitive market offering wide choice and efficient prices. 1.4 The PIU report defines electronic commerce as "the exchange of information across electronic networks, at any stage in the supply chain, whether within an organisation, between businesses, between businesses and consumers, or between the public and private sectors, whether paid or unpaid". 1.5 The PIU report distinguishes between process and transaction e-commerce. Process e-commerce is the provision of facilities and services required to access and transmit information and to provide transactional services. Transaction e-commerce is defined to be the use of e-commerce channels for the supply of goods and services to consumers and businesses. 1.6 This study focuses on ‘process e-commerce’ – that is developments in the infrastructure and access mechanisms necessary for online merchants to deliver e-commerce services to consumers. Relationships between players in the retail market and the impact of e-commerce on traditional markets are the subject of a separate study by OFT (see Annex A) on the impact of growth in e-commerce on competition in distribution and retail markets. That study will consider whether current powers and methodologies will be sufficient to address competition issues that may emerge. 1.7 In examining issues of access to infrastructure and services this study aims to:
1.8 OFT is responsible for administering the Competition Act 1998, and OFTEL has concurrent powers, in relation to commercial activities connected with telecommunications, under that legislation. OFTEL also has specific regulatory duties under the Telecommunications Act 1984. It is therefore appropriate to consider any competition issues in the context of these powers. 1.9 Stifling of competition is not the only potential barrier to the development of e-commerce. Issues relating to lack of trust or training are at least as important factors. This report notes these additional areas where relevant to set the wider context in which competition issues are being examined. However, it is not within the remit of this study to examine these wider issues in any detail. The PIU report addresses these issues elsewhere. 1.10 The issues contained in this document have emerged from market research, academic literature, experience of case handling in different competition authorities around the world and initial discussions with key players (listed at Annex B). We are however, in addition particularly keen to hear from small businesses in response to this document, since we are conscious that input from this important group has been limited so far. We are also conscious that there may be live issues under consideration by players in the market which for reasons of commercial confidentiality they may prefer not to share with regulators. For this reason we have considered a range of different scenarios, but there may be others on which we should be grateful for views.
Market developments 2.1 The pace of growth and take-up of e-commerce has outstripped every other technological development in recent times. Revenue from Internet sales in Europe in 1999 is expected to be $288 billion rising to $2 trillion by 2002 (KPMG Consulting November 1999). According to Datamonitor, UK consumers spent $60 million on-line last year, and are second in Europe only to the Germans for on-line shopping. E-commerce is becoming an important part of the retail business, but also offers advantages for business-to-business transactions. KPMG Research has shown that 4% of European corporate sales were transacted on the Internet – with 6% of corporate sales in the UK on-line. Projections suggest 14% of business to business sales will be made on-line by 2003. e-commerce is transacted using a PC modem and standard telephone line. But this will be just one of a number of ways in which consumers can access online services in the future. Online shopping is already available over digital satellite and cable TV. From 2002, analysts (Durlacher Mobile Commerce report 19 November) predict that mobile phones will become widespread as a delivery mechanism for electronic commerce. The speed of access will also increase with the introduction of technologies such as Digital Subscriber Line (DSL), cable modems, broadband fixed wireless and satellite.
2.3 The open trading environment of the Internet has fostered the emergence of numerous start-ups in the UK and elsewhere such as QXL, jungle.com and lastminute.com. Traditional ‘bricks and mortar’ companies have also been able to take advantage of online opportunities with off-shoots such as Prudential’s Egg banking service and Dixon’s Freeserve. All of these companies will be looking to expand and develop, make use of new technologies and deliver to new markets. It is important that the regulatory framework allows these and other entrants to continue to flourish. The chain of dependencies 2.4 In any e-commerce transaction, be it business to business or business to consumer, there are several elements required to enable the flow of information between supplier and customer. It is important, in assessing the state of competition to identify the relevant segments of the market, and interdependencies between segments of the market. Particularly in fast-moving areas like e-commerce, the nature of markets may change in a relatively short timescale. Developments in technology may mean that a particular function is no longer needed or that efficiencies can be gained by combining one function with another 2.5 At present, most people in the UK access e-commerce services over a PC either by means of a dial-up account at home or at work via a leased line. But consumer access is likely to change significantly over time as higher bandwidth access emerges and different devices such as digital set top boxes, mobile handsets and games consoles offer new ways of delivering interactive content to the home. Meanwhile smaller businesses will also be able to benefit from keenly priced higher bandwidth access to communicate with suppliers and deliver e-commerce services to customers. 2.6 This chapter looks at the technologies currently being used to provide e-commerce services to customers, and how those technologies may evolve over the next few years. Internet access through the PC Dial-up and leased lines 2.7 There are currently over 400 consumer ISPs in the marketplace, many offering ‘free’ or subscription-free access to a number of well-established portal sites and open access to a wide range of Internet content and e-commerce sites. Take-up of Internet services has grown rapidly in this dynamic market. Around 5 million (20%) homes in the UK currently have Internet access via their PC, a figure that has doubled since 1999 and looks set to grow. The number of Internet users, defined as those with access at home or work is set to increase at an even faster rate. 2.8 This rapid expansion has partly been attributed to fierce competition amongst a new generation of ‘consumer-focussed’ ISPs. The best known of these consumer ISPs and currently the largest in the UK is Freeserve, which popularised subscription-free access in 1998. Many other ISPs have since pursued a similar pricing model and some now offer access on a freephone number at certain times of the week. Completely ‘unmetered’ access will also shortly become more readily available – the technological arrangements contributing to this development are discussed in more detail from paragraph 2.19 below.
2.9 Consumers using ‘dial-up’ services typically connect over the public switched telephone network (PSTN) using a non-geographic number which allows them to call from anywhere in the country at local call rates. The call usually originates on BT’s network (BT provides around 85% of local access lines), but is often terminated on other operators’ networks, with the terminating operator taking a share of the call revenue. The operator which terminates the call (such as Energis, MCIWorldcom and Cable & Wireless) will then often act as a ‘backbone’ or ‘carrier ISP’ processing the traffic and providing connectivity to the Internet at large. Very often, the ‘consumer’ ISP with whom the consumer has a direct relationship does not provide any connectivity of its own. Rather it resells the Internet access provided by the ‘carrier ISP’ and packages it with its own content or portal site. 2.10 Consumer ISPs generally take revenue from two sources. They often negotiate a share of the call revenue from the terminating operator (a portion of the call charge paid by the end-customer). But portal sites are increasingly becoming the most important revenue-generating mechanism in this area. Through reselling Internet access consumer ISPs are able to increase traffic to their portal by directing users there when they access the Web. High traffic enables them to sell advertising and positioning on that page to online retailers. However, while a consumer ISP will usually set their own portal (or an affiliated portal) as the default ‘homepage’ for their users, users are not prevented from going elsewhere or from resetting their Web browser to use another homepage. 2.11 Overall, while consumer ISPs typically aim to provide an environment that will attract and retain users and enable them to direct traffic towards preferred content ‘partners’, there do not appear to be any significant barriers to retailers reaching customers. Online retailers can set up a standard website using established protocols, which can be freely accessed by all consumers with Internet access. This will usually need to be backed up with advertising on one or more portal/search sites, but portal sites are not the only advertising routes available (indeed much advertising is now through traditional media) and there are a relatively large number of these sites. Thus advertising prices are likely to be constrained by competition. That is not to say that there are no identifiable major players in the current portal market. It is interesting to note that between them Yahoo, MSN and AOL, the main three portals, capture around 15% of Internet traffic but around 45% of advertising revenues. However, there is pressure to differentiate portal sites and it is predicted that niche or ‘vertical’ portals covering specific subject matter will become stronger in capturing advertising revenues.
2.12 In summary, the current system has fostered what is generally held to be a highly competitive market, with a number of players at each stage in the chain. The exception is call origination, BT’s dominance in which has tended to result in constraints on tariff structures with price points centring around BT standard call rates. However, in late 1999 OFTEL introduced new arrangements to give greater flexibility in pricing, which should feed through into greater tariff choice for end users. Otherwise non-geographic numbers and the any-to-any nature of the existing telephone network (PSTN) have enabled terminating operators and carrier ISPs to enter the market and develop from a relatively small base. In turn this has offered choice of carrier to consumer ISPs. With open web access being freely available through a number of ISPs, content providers and retailers have been able to access customers, and to advertise their services through a number of portals. 2.13 There are however two underlying concerns that have emerged. The first relates to potential barriers in the ‘backbone’ or carrier ISP market. This is an important segment of the e-commerce market as IP carrier services are an input to all forms of Internet access from dial-up to leased lines. Connectivity (the number and size of pipes linking one country to another and from a given ISP to another) is a crucial element in providing carrier ISP services. Connectivity between one ISP and another is provided either by means of a peering arrangement (a free agreement between players of similar size) or by buying transit (purchasing connectivity from a larger player). 2.14 All ISPs except the very largest make use of both peering and transit arrangements, but the more connectivity an ISP has, the greater its bargaining power. The largest players (referred to as ‘Tier 1’ players) rely entirely on peering and have no need for transit arrangements at all. Because connectivity is so valuable, larger players may have a significant advantage in the market and may attain ‘market power’. Abuse of this power might manifest itself through excessive charges for transit, making it difficult for smaller players to enter the market or expand. 2.15 In the assessment of the Worldcom/MCI merger, the European Commission concluded that Tier 1 IP network providers were in a separate market from those ISPs that had to supplement peering with transit agreements or do not have a network of their own. This same issue is now being examined by the US Federal Communications Commission and European Commission in their investigations into the proposed merger of Sprint and MCI Worldcom. 2.16 The other concern relates to a potential lack of competition in certain types of leased lines – in particular the final short link to the customers’ premises (local tails). Leased lines of all kinds are important inputs to e-commerce markets, allowing businesses to communicate internally between sites, connect to consumers and other businesses and access the Internet at large at high speeds. Most large organisations, online retailers and ISPs are dependent on leased lines to conduct their business effectively, and it is felt that small businesses will increasingly need ‘always-on’ connectivity at this level if they are to participate fully in and contribute to the information society. 2.17 It is generally considered that competition in long distance high bandwidth pipes and in certain urban areas where there is a concentration of large businesses is well developed. But competition may not be effective in lower bandwidth connections (up to 2Mbit/s) usually used to link individual premises to the high-speed backbone network. As leased lines are currently the subject of an investigation by OFTEL, this report will not examine this area in detail. 2.18 However, other than these two issues, interviews with industry so far suggest that in competition policy terms there are low barriers to entry and no significant technological barriers to setting up an e-commerce business, whether that be a consumer ISP or an online retailer. The suggestion has been that barriers are more likely to be associated with, for example, access to banking and credit clearing facilities and gaining the trust of consumers. These issues are dealt with elsewhere in the PIU report. Achieving network efficiencies 2.19 As discussed above, it appears that access over the PSTN has been successful in enabling the development of competition in Internet services and content. However, future moves in Internet access are likely to bypass the PSTN, which as a network designed for narrowband voice is unsuited for carrying ‘bursty’ Internet data flows. 2.20 One way of achieving network efficiencies is to take Internet traffic off the PSTN at the earliest possible opportunity and transfer it onto the IP backbone. Such efficiencies mean that new pricing arrangements for Internet access including unmetered access may be possible without threatening the integrity of the voice network. This is the network arrangement currently put forward by BT for its new ‘Surftime’ product, which as proposed will offer unmetered access for around £30 per month. It is also being used by Telewest and NTL to offer unmetered access to subscribers within their franchise areas. 2.21 The impact of unmetered access on consumer habits could be significant. It will allow consumers to manage their bills for Internet access and stay connected without watching the clock. In the most recent Durlacher Quarterly Internet Report it is estimated that UK residential use of the Internet could triple from 130 hours per year to 386 hours per year if unmetered access were made widely available. This is also likely to have an impact on consumer spending online. 2.22 While ‘unmetered’ initiatives like BT’s SurfTime are likely to be popular with consumers and bring significant benefits, they may also significantly affect the relationships between suppliers in the chain, with potential implications for the development of competition. As an operator with Significant Market Power, BT must ensure that other operators and service providers are able to offer service on the same basis as its own downstream businesses. But to provide an unmetered offering using architecture similar to BT’s, other operators would either need to extend their network coverage to bring their IP networks closer to consumers or agree appropriate interconnection arrangements with BT. 2.23 Using network efficiencies such as those described above to deliver unmetered access is unlikely to be the only model going forward. Indeed Altavista, the US-based portal site recently announced an unmetered package based on a freephone number that will operate via existing PSTN arrangements. It is also likely that some consumers will continue to use existing ‘subscription-free’ pay-as-you-go services – these are likely to be more popular with light users and those testing out Internet access for the first time. However while pricing models other than unmetered and forms of unmetered access that do not rely on network efficiencies may continue to exist, achieving efficiencies is likely to be increasingly important as increasing Internet usage puts pressure on the existing PSTN, and new higher bandwidth technologies emerge. This will undoubtedly present a challenge to existing terminating operators and carrier ISPs and drive the need for increased network investment. Higher bandwidth access to the PC 2.24 The trend to drive access closer to the customer to achieve greater network efficiencies is likely to continue with the roll-out of higher bandwidth access and services. Technologies such as DSL, cable modems, Third Generation Mobile, Broadband fixed wireless access and satellite offer the potential for higher bandwidth interactive services, such as high-speed always-on Internet access and video-on-demand to be delivered to consumers and small businesses.
2.25 This fast access is achieved by upgrading the final mile to the customer (or providing a new high-speed link) and passing traffic direct onto a high-capacity backbone network. These technologies offer a real opportunity for the development of new services and applications, but the nature of the network enhancements is likely to significantly affect relationships between companies in the Internet access market. As upgrade of local access lines is crucial to the delivery of these services and the services are not supplied over a switched any-to-any network, the operator owning the local access lines (the originating operator) has greater potential to influence the end-to-end process. 2.26 Much of the value delivered over networks derives from the services and content, and higher bandwidth network architectures provide the means for network owners to develop or form alliances with content services and offer a vertically integrated package combining network access, Internet service and portal site. For instance, it is widely considered that the rationale for the merger of Excite with @Home was to secure a broadband delivery channel for valuable content. 2.27 Such alliances and vertical integration may be beneficial to the production of innovative new content and services, ensuring that sufficient resource is given to technological development and content creation. In addition, these kinds of alliances may facilitate new payment mechanisms, for example for content via bills for communications services, overcoming the need for exchanging card details on-line. But they may also limit the breadth of competition at each level restricting the ability of independent ISP and portal sites to access customers (see figure 4).
2.28 This is likely to be a particularly significant issue where one supplier has dominance in the higher bandwidth access market. In the UK, OFTEL has decided (November 1999 Statement "Access to Bandwidth: Delivering Competition for the Information Age") that because BT’s dominance in the local access network has the potential to enable it to act as a gatekeeper to DSL technology, it should be required to offer unbundled local loops to other operators. This will enable others to compete with BT in upgrading the loops to provide higher bandwidth access. As an operator with significant market power, BT is also obliged to allow other service providers to access customers over its upgraded network on non-discriminatory terms. But these types of requirements are placed only on operators with the ability to create market distortions. 2.29 It is yet to be seen in the UK whether similar open access arrangements will emerge voluntarily in cable and the other access routes offering choice to consumers, or indeed whether developments in the cable market will result in a player with sufficient market power that it too becomes subject to regulatory ‘open access’ controls (OFTELwill soon publish a consultation document on Access to Telecommunications Networks). The current view of cable operators is that bundling access with high value services and content is necessary to recoup high investments in infrastructure, and thus it is unlikely that voluntary open access arrangements will emerge, at least in the short term. 2.30 Even with closed and vertically integrated networks, providing there is choice between different technologies, ‘pillars of competition’ (eg between cable, DSL, Broadband Wireless) may still constrain prices and promote innovation. In this context it will be important to assess to what extent, when they emerge, the new higher bandwidth technologies on offer will be direct substitutes for existing forms of higher bandwidth access, and thus whether they really will be in direct competition with each other. It has been suggested that while cable and DSL will overlap to a certain extent, other technologies may be offered as alternatives or complements, perhaps with satellite covering sparsely populated areas not reachable by DSL and mobile being offered as a complement to fixed technologies for people on the move. Alternative devices now and in the future 2.31 While the PC will undoubtedly continue to be a valuable route for accessing the Internet, PC penetration stands today at only around 40 per cent of households, and is not predicted to expand much beyond 55 per cent by 2015. Reports suggest that other interactive devices will become more widespread and will ultimately overtake the PC as mechanisms for mass-market delivery of interactive services. Access using the TV with the advent of digital broadcast (via set top boxes) and games consoles, and through mobile phones, promises to become an important mechanism for broadening access to the information society. 2.32 The role that these new devices will play in bringing online services to the general public makes it particularly important that competition in these sectors flourishes and that market positions are not abused. A potential concern with these devices is that incompatible hardware and proprietary software can be used as limiting factors, giving network operators or device manufacturers the opportunity to control the gateways between the content provider and the end consumer. Also, if hardware is not interoperable customers will need to buy new devices if they want to switch services, the complexity and expense of which is likely to act as a deterrent to switching. Work to agree common standards between set top box manufacturers is ongoing, along with a similar process within the mobile industry, so interoperability standards may develop, but this is an issue that is yet to be fully resolved. Interactive services via TV 2.33 Interactive content is already being delivered via digital TV – Open (formerly BIB) is currently available to more than 2 million households through the digital satellite platform offering interactive services and email. Digital interactive cable services are available in limited locations offering virtual shopping malls and e-mail. OnDigital is now offering email and developing interactive services. 2.34 This kind of access through the familiar broadcast system is attracting a new type of interactive customer and fostering the development of both new free e-commerce services and new types of pay services such as interactive quiz shows taking advantage of associations with popular TV programmes.
2.35 Access through set-top devices is typically to a selected ‘walled garden’ or ‘fenced prairie’ of sites. It is not clear to what extent unfettered access to the wider Internet will be available (it is currently only on offer through NTL and requires some formatting of the web pages to make them presentable on a TV screen). Increasing demand from consumers may put pressure on other network providers to provide full Internet access, but even if it is possible, TV network operators have suggested that they are likely, for practical financial and technical reasons, to focus on more controlled activities within the walled garden. The rationale for this is generally that:
2.36 It may be that for some segments of the population, digital TV will be the only mechanism available for accessing interactive services and e-commerce. While PC ownership may stall, the proposed analogue switch off will encourage take-up of digital providing interactive capability to nearly every household. If this is the case, it will be important to assess whether there are sufficient constraints within the market place, in the form of sufficient competition between platforms and within platforms to ensure widespread choice and value for money for consumers. The effectiveness of competition in this area will be of significant importance to online retailers, which may not be able to access a significant proportion of customers without a presence on set-top boxes. 2.37 The European Commission concluded in relation to the BIB (now Open) joint venture in 1999 that:
2.38 These types of issues are likely to become increasingly significant as the market develops and TVs become, for some at least, the primary mechanism for accessing interactive services. Mobile commerce 2.39 Mobile phones are set to become another mainstream route for accessing interactive services. A new technology called Wireless Application Protocol (WAP) enables ‘web’ data to be interpreted and displayed on mobile handsets. A string of deals have recently been announced such as those between Vodafone and WH Smith Online (books and CDs), Affinity Internet (games and electronic wallet) and the Met Office (weather) to provide services over WAP-enabled phones. WAP technology will be complemented by the introduction of GPRS, a network enhancement that will allow phones to access data at speeds similar to those available via ISDN, and Third Generation Mobile, which will be available from 2002 offering speeds of up to 2 Mbit/s. 2.40 Just as with the TV, display limitations make it difficult to present standard Internet websites on a mobile phone handset. Instead a new standard mark-up language WML, which is similar to HTML used for standard Web pages, has been developed. WAP is an open standard and, technically, any service provider may set up a WAP server and host a WAP portal. Users should be able to access any of this content by dialling into the WAP server from a WAP-enabled handset. However, the advertising and transaction revenues which may be generated from popular portals provide an incentive for network operators to establish their own WAP gateways and drive users to that site in preference to others, for instance by setting up a ‘hot-key’ which dials straight into that content. The network owner may also be able to leverage user location information available only to itself in presenting WAP information.
2.41 However, the market may not develop this way. In addition to countervailing power held by others in the supply chain, advances in technology may make it much easier for handset manufacturers, independent service providers or content providers themselves to define how content is developed and presented over mobile networks. The mobile market may see the emergence of new players from the traditional Internet or content worlds. The recent entry of Virgin may provide a useful model for the entry of new ‘virtual operators’ providing their own content and services using WAP, GPRS and third generation. 2.42 While trends such as vertical alliances are emerging in the mobile market, it is impossible to predict at this stage how the market will develop and whether developments will facilitate competition in the provision of e-commerce services or hinder it. Just as with set-top devices, the test of ‘convergence’ will be important in assessing this market, particularly whether mobile commerce is a market in its own right or whether the availability of access through other devices such as the TV and PC will constrain the activities of network operators. Who will own the platform? 2.43 Another important issue is whether any one proprietary software ‘operating system’ or ‘middleware’ will come to dominate on these new devices in the same way as Microsoft has come to dominate (with above 90% market share) the desktop PC platform, and how such domination might affect the market. There are currently a number of software developers providing middleware for interactive devices. For instance, OpenTV is used on BskyB digital set-top boxes in the UK whereas OnDigital use Media Highway, and NTL use Power TV. But this may change. Investments by Microsoft in cable operators in the US (AT&T) and in the UK (NTL) have been associated with a shift towards Microsoft’s cut-down version of the Windows operating system, (Windows CE). 2.44 Likewise mobile handsets require operating systems to enable interface with applications such as browsers or calendars. Until recently operating systems were mainly produced by the handset manufacturer, but this may change with a trend towards equipment manufacturers forming alliances or partnering software companies to create new products. Symbian, a joint venture between Ericsson, Nokia, Motorola, Panasonic and Psion is seen to be the likely frontrunner in the development of an operating system (called EPOC) to run on smart mobiles, but Microsoft is also keen to establish a presence in this area with versions of its Windows operating system and has concluded deals with Sony and Ericsson to use its Microsoft mobile explorer software. 2.45 Palm personal computers such as the Palm pdQ have greater functionality and more processing power coupled with larger screens that can better display web pages. Some will have dual mode, enabling display of mobile-adapted WML or traditional HTML formatted information. Again there are a number of companies competing to provide operating systems for devices like these. With a number of significant developments such as GPRS and 3rd Generation Mobile shaping the mobile industry it is difficult to predict how the markets for operating systems and applications will develop. It has been suggested that even if operating systems continue to be proprietary incompatibilities between systems may be bridged with technologies like Java that allow applications to be developed and run across multiple platforms. 2.46 Proprietary rights tend to be a feature of access devices such as set top boxes and mobile phones. The dominance of any one software producer in these devices could create competition concerns if that position was abused to stifle innovation in the operating system and application businesses. One of the most high-profile competition cases to date has been the anti-trust case brought by the US Department of Justice against Microsoft alleging abuse of a dominant position in leveraging dominance from the Windows operating system to stifle the competitive provision of Web browsers. The European Commission also recently announced an investigation into Microsoft’s new Windows 2000 operating system. Q How do you see competition developing in the software market as new devices emerge and develop? Q How important a role will companies providing middleware and software applications play in shaping the market for e-commerce services over new interactive devices? 2.47 There are a range of services that e-commerce providers may need to enter the market. Entrants will need to decide whether they will buy the necessary hardware, software and expertise to host the site themselves, or whether they wish to contract these services elsewhere for example by renting space from a Web hosting company. While server software can be downloaded for free from the Web, access to other middleware is required, such as e-commerce transaction software and the ability to safely process payment mechanisms on-line e sites. Web hosting companies will look after the web site for the merchant, providing a bundled service including domain name registration, e-mail, security, technical support, financially transactable facilities and web space. Companies such as Planet manage high security Web farms on behalf of UK retailers. Q Are businesses wanting to provide e-commerce sites faced with sufficient choice, variety and quality of hosting services to meet their requirements?
Key trends and themes in the new environment 3.1 Some important technological developments have been explored in the previous chapter. These developments will not only affect the quality of the services provided to consumers. They are also likely to change the way markets interact as companies evolve to exploit new e-commerce opportunities. The current environment is characterised by the existence of a large number of consumer ISPs, with a relatively competitive market in call termination and carrier ISP services. Open standards have enabled the development of a large number of content and e-commerce providers. But it is widely accepted that the market will change over the next few years. An examination of emerging technologies and discussions with industry suggest that three key themes will be important.
Vertical Integration 3.2 The PSTN is by its nature any-to-any. New higher bandwidth access technologies will not be, at least to start with. This means that access providers (those providing the final link to the customer) will take on a more pivotal role as they gain the ability to control the services and content provided to users. This may be beneficial. Owning the final mile of the infrastructure allows companies to offer tailored interactive services and direct traffic towards a portal site. The portal site in turn can be used to generate valuable revenue to support the infrastructure and service provision. New devices and particularly set-top boxes offer further opportunities for tailoring and control over the services offered. But this model may present difficulties for independent service providers and portal sites. 3.3 On the other hand it is unusual for companies to be equally competent at supplying network and content services. Some may choose an open access model, hoping to become the technology winner by attracting the maximum number of service providers to their particular network or platform. This may particularly be the case for incumbent operators or those with Significant Market Power, partly driven by regulatory constraints. The choice of services available via these open platforms may prove attractive to customers encouraging other network providers to follow suit. Convergence 3.4 Convergence (a blurring of distinctions between and overlapping of traditionally separate markets) will become an increasingly important concept when assessing new markets. The extent to which any two or more technologies may be or may become substitutes will be a significant factor in whether any company faces competitive constraints. 3.5 Industry’s current view seems to be that convergence may happen in certain areas, but perhaps not to the degree that has been predicted. To the extent that it materialises, convergence may best be seen in the use of a range of fixed networks to deliver high-speed Internet access and television. Different access mechanisms may be used in different circumstances to achieve the widest possible reach. For instance, cable operators such as NTL are looking at the possibility of using DSL as well as cable modems to deliver interactive services and TV. 3.6 Some in the industry suggest that convergence may fail to materialise to the extent often suggested between fixed and mobile networks and in access via different devices. 3.7 The industry suggests that while mobile data access will be valuable, it will probably be a complement to rather than a replacement for a fixed link. Its value will come from mobility and the ability to locate users and tailor services appropriately. But it may always be playing catch-up to fixed links in terms of the data speeds available and truly mobile broadband may be limited. 3.8 While availability of different devices will undoubtedly increase consumers’ overall exposure to interactive services, and content providers will aim to spread their reach across as many platforms as possible the industry is sceptical about the extent to which services delivered over PCs, TVs and mobile phones will be equivalent. It is anticipated that people may use different access devices in different ways, or that different means of access will be adopted by different groups of user, choosing the system that best meets their needs. For example:
Expansion and consolidation 3.9 Consolidation amongst mobile network operators across the global marketplace is already apparent with deals such as the Vodafone Mannesman merger in the pipeline. Consolidation between ISPs and traditional telcos (terminating operators) has already happened to a large extent. The next stage for telcos is likely to be significant expansion as operators build out networks to compete with incumbents in the provision of new broadband access technologies. Given the increasingly high costs of establishing a network to rival those in existence, it may become difficult for new providers to enter the market. 3.10 At the other end of the chain, it may still be possible to set up a website at relatively little expense. Starter investment and stock market investor sentiment continues to favour Internet and technology companies both in the UK and abroad, although there have been some signs of nervousness in the markets recently. It is widely suggested that at some stage there will be a shake-out with a smaller number of content companies and retailers taking central stage. Content companies may face increasing expenditure as they expand their content onto new platforms including TV and mobile. In an increasingly crowded market brand-building is also important, and advertising may become an increasingly essential commodity. 3.11 Although content does not currently appear to be in short supply, there may be certain content which is of sufficient quality to attract users in such numbers that exclusivity around such content could have the effect of creating or damaging market positions and ability to compete. Online retailers may also need to provide attractive revenue sharing arrangements to gain favourable positioning on portal sites. The extent of competition amongst network operators and service providers and the knock-on effect this has on competition in the portal market may have a significant effect on content providers’ ability to promote and deliver their services. Globalisation 3.12 Installing infrastructure such as IP networks requires significant investment but the rewards of being a ‘tier 1’ player are high. Multiple global links are essential to be competitive in the carrier ISP market and connectivity is important in concluding favourable peering arrangements. 3.13 With content easily accessible from every country, it is a logical step to make products universally available. This has happened typically from the US to Europe, with Amazon, E*trade and others setting up businesses in Europe. European companies are now likewise looking to expand overseas. Content provided through proprietary platforms such as the TV may however continue to be more locally based. Q Have we correctly identified the main themes for market developments in e-commerce industries over the next few years? Issues for the future 3.14 The pace of change in this area is such that it is difficult to predict how the market will develop in the months and years ahead. Rather one could focus on a number of variables. Consumer behaviour
Market forces
Government initiatives, regulation and legal issues
Q. Are these the most significant variables in the development of electronic markets for the future? 3.15 All of the above factors are likely to impact the development of the market and the emergence of competition. Indeed consumer behaviour in particular is likely to have a considerable impact on the development of and expansion in the market for Internet and interactive services. Based on these variables, and assuming that issues of consumer awareness and confidence can be overcome and that the regulatory regime remains as currently with controls placed primarily on those companies with market power, one could construct a number of scenarios as to how the market will develop. Scenario 1 – full competition 3.16 Higher bandwidth access is available through a wide variety of mechanisms in most areas, providing competing delivery channels for Internet access and other services. While there are few network operators/IP providers, each has an extensive network, and is constrained in pricing and service delivery by competition. Network operators choose to focus on infrastructure build and decide to open access to their networks to allow service providers to take on the ‘marketing’ of the technology and services it provides to consumers. The multitude of service providers leads to intense competition in the portal market enabling content providers to access customers and purchase advertising on reasonable terms. While market entry in infrastructure build is difficult there are numerous opportunities for reselling access and adding value. Smaller content providers are able to find a niche. Scenario 2 – limited competition 3.17 Consumers and small businesses in city areas have choice of several DSL suppliers and a cable supplier for higher bandwidth access, but some may not have a choice. There are hot-spots of competition where access is available reasonably cheaply (primarily through fierce competition in DSL), but in others and particularly rural areas, access remains scarce and expensive. While there is an opportunity for multiple service providers to resell or to provide high speed services over BT’s local access network, other high bandwidth infrastructures including cable remain closed with vertical integration in the provision of access, services and content. Providers aim through the closed architecture to increase revenues through e-commerce and use these revenues to subsidise services and hardware. Content providers have ample opportunity to advertise and access customers, but to be on all platforms in all areas is expensive and is likely to be restricted to some of the larger players. Scenario 3 – high bandwidth fails to materialise 3.18 Convergence with similar applications delivered over many devices and variety of different pipes is unrealised. While higher bandwidth access is available, high prices and lack of ‘killer applications’ make it a minority service. Unmetered low bandwidth Internet access is sufficient for most people’s needs. There are a large number of consumer ISPs providing unmetered access, but most are reselling elements of BT’s service. Other network operators focus on business to business services in a number of key locations rather than building out networks extensively. Access to interactive services is available through set-top boxes, but there is little relation between the style of content provided via the TV and PC provided content. TV viewers tend to stay within the walled garden of specially designed content. Access to the TV platforms is expensive and restricted to larger players, but smaller content providers are able to continue to provide functional services over a narrowband Internet connection. (Scenarios with a particular focus on wireless access technologies have also been developed by the Radiocommunications Agency as part of their project on Mapping the future of convergence and spectrum management as outlined in the recent report Strategy for the Future Use of the Radio Spectrum in the UK (2000).) Q Given the above variables and any others not identified, what would you consider to be the possible scenarios for the development of e-commerce industries in 3 years time? 3.19 Whether competition issues arise depends on the way in which the market develops and also how any particular company responds in that market environment. While it would be inappropriate to identify specific problems at this stage, it is possible to identify a number of potential tensions. Many of these are not new, but are familiar subjects in the context of general and telecoms specific regulation, which may take on increased significance with the development of e-commerce:
Q Do you see these as being the major competition issues relating to electronic markets in the foreseeable future? 3.20 The next chapter examines these topics further and discusses the circumstances in which regulatory authorities might take action, the form this action might take and whether the tools currently available are sufficient to deal with issues that may emerge in these new and developing markets.
Competition policy and regulatory approach The role of competition and regulatory authorities 4.1 The primary role of regulatory and competition authorities is to promote the interests of consumers – that is to ensure consumers have choice and value for money when purchasing products and services. This is mainly achieved through preventing anti-competitive behaviour and promoting competition in circumstances where it is not yet effective. This study focuses mainly on these two activities. 4.2 But these are not the only activities carried out by these authorities. Consumer awareness is also important factor in facilitating a competitive marketplace by ensuring that consumers are aware of the choices and can make an educated decision on which product to choose. And there are circumstances where competition and education alone does not deliver sufficient consumer protection. For instance specific protection may be needed from certain intrusive forms of advertising such as unsolicited calls, faxes or email. 4.3 OFT is the UK competent authority dealing with the national application of European competition law. OFT therefore acts as the link to the European Commission Competition Directorate. It is responsible for acting against UK and EU mergers that will adversely affect competition. Under the general competition regime, it is responsible for seeking out and acting against anti-competitive agreements and abuse of market power across all sectors of the economy. 4.4 OFTEL is the sector specific regulator for telecommunications, having a statutory duty to promote competition in a market still dominated in certain areas by a former state monopoly. Where possible, OFTEL’s policy has been to encourage competition. The aim is to promote competition in a way which would mirror conventional market developments, or where the characteristics of the telecoms market mean that competition in any given area is likely to remain limited, to recreate these conditions through regulation. Sector-specific regulators like OFTEL generally take an active role in managing the transition from monopoly to effective competition. OFTEL also has concurrent powers under national competition legislation to prevent and tackle anti-competitive behaviour within the telecommunications industry. Key issues in electronic markets 4.5 Issues can arise in electronic markets where dominant players in traditional markets aim to leverage their market power into adjacent markets and distort competition in those markets. Equally, it may increasingly become the case as new markets mature that new operators attain market power in certain sectors. In the previous chapter we identified a number of potential competition issues. These primarily fall into two groups:-
4.6 In the remainder of this chapter, we consider the following: the role of regulatory and competition authorities in fast moving markets; whether the established competition policy tools and the current institutional structure will allow e-commerce issues to be dealt with effectively; and the powers OFT and OFTEL would have to address these issues if they emerged and how these might be used. Approaching competition cases in electronic markets 4.7 In assessing whether behaviour is anti-competitive or whether a company is in a position in which it could act anti-competitively, it is necessary to establish the relevant market for the products and services affected and whether suppliers in this market have market power. 4.8 In fast-developing markets particular care needs to be taken when defining markets. The fact that a market is rapidly developing is not in itself a problem, rather the uncertainty about how a market will develop. When products are new, or new generations of technology are emerging, market shares based on current or historic information may not be a true indicator of market power. Attention needs to be given to the likelihood of new business models emerging that might significantly alter the balance of power. The extent to which other products currently in separate markets may converge to the extent that they become substitutes and competitors to the product being investigated also needs to be considered. 4.9 It is also important to stress that defining relevant economic markets and calculating market shares are only tools used in considering whether certain undertakings have market power. Although this may not always be straightforward in e-commerce markets the process itself can be very informative in considering whether companies have market power. 4.10 The nature of market power and its existence can only be assessed on a case-by-case basis. For the purposes of this document it is sufficient to say that market power can exist in a variety of contexts and to varying degrees. In some markets, single undertakings may have market power. If a significant degree of market power is attained then a player might be described as being dominant in a market. Where a market is concentrated it may be that no single company is dominant, but a group of companies may be linked economically and may thus collectively be considered to possess joint dominance. 4.11 A particularly important consideration when assessing markets and abuses of market power is to establish whether there are significant barriers to entry and whether any barriers that exist are the result of anti-competitive behaviour or due to some external force such as:
4.12 While this last category of barriers to entry is outside the remit of competition or regulatory authorities it is nevertheless a factor which needs to be taken into account. Other examples might include the absence of venture capital and lack of consumer confidence in e-commerce brought about by security and privacy concerns. 4.13 The OFT has commissioned a study to consider the issues relevant to market definition in dynamic markets of this type, which will be published in the near future, and which will inform this consultation. It has also recently commissioned research to consider the implications for competition policy of the growth of electronic commerce as a means of distribution and retail. This will consider how transaction e-commerce may impact on the competitive nature of markets, either generally or for specific (classes of) goods or services and whether the traditional analytical tools used in competition policy may have to be adapted as transaction e-commerce grows. Q Are there any other areas where you believe that established tools or approaches are not readily applicable to fast moving markets? Q What are your views on whether, and how, markets can be meaningfully defined in fast moving sectors? Taking action 4.14 The role of competition and regulatory authorities in fast-developing markets such as e-commerce and software is an issue of some debate. Some argue that intervention is unnecessary as rapid growth and development of the Internet means that the industry is not conducive to long term dominance by a single firm. Others that intervention could be damaging to the interests of consumers by undermining the incentives to innovate. 4.15 OFT and OFTEL do not accept that there would never be a need for intervention in e-commerce markets, but do accept that inappropriate intervention or intervention with only short term goals in sight could be damaging to competition over the long run. While it is necessary to protect competition and encourage the development of competition where it is not effective, inappropriate regulation can distort markets and affect the direction a market takes. Intervening in circumstances where market power might be short-lived is likely to be unnecessary and ineffective. It is also important to ensure that in taking regulatory action, incentives to invest are not undermined. 4.16 But the fact that additional considerations need to be taken into account does not preclude action from being taken when necessary. For example, it is essential that firm and effective action be taken against anti-competitive practices such as abuse of a dominant position as required by the Competition Act 1998. Regulatory action may also be justified, under the Telecommunications Act 1984, to prevent the creation of barriers to entry which would have the effect of stifling innovation. For example, particular care needs to be taken to guard against an incumbent using a dominant position to distort competition in subsequent generations of products and extend its position into other markets. Q What are your views on the role of OFT and OFTEL in e-commerce markets? Q Are there any characteristics particular to e-commerce markets that suggest a different approach from that outlined above is needed? Q Are there circumstances in which regulatory authorities should be more pro-active? The need for speed 4.17 Abuse of market power in a fast-developing market could, if left unchecked, have a wide-ranging impact on the market in a relatively short space of time. Electronic markets can change quite dramatically in a matter of months or years. Thus if action to combat anti-competitive behaviour is to be effective, it should be as swift as is practically possible. 4.18 One potential complication in converging markets is that there may be a number of different UK and European regulators with concurrent jurisdiction with the consequent risk of regulatory confusion. Working groups have been set up across various regulatory bodies eg the Group of 3 which co-ordinates action between OFTEL, OFT and ITC in areas of overlapping regulatory interest in the UK to ensure that issues which cross boundaries are handled cohesively. But it is recognised that this may not be a satisfactory solution for the long-term. Government has said that it will be bringing forward new legislation in the next parliament on the regulation of communication. This is expected to rationalise the position and seek to minimise regulatory confusion. 4.19 There is also a need in the context of fast-developing markets to ensure up-to-date sector knowledge in regulatory bodies and refine case handling procedures. A concern sometimes expressed is that authorities may become aware of problems too late and that complaint driven systems may not be appropriate in all cases. OFT has recently been restructured on sectoral lines mirroring the structure of the European Commission’s Competition Directorate. The new structure will also further enhance the DGFT’s ability to carry out the duty under the Fair Trading Act 1973 to keep markets under review. 4.20 OFTEL is also implementing a system of proactive market reviews. Each sector of the telecoms market is examined at two-yearly intervals, enabling OFTEL to assess the state of competition, identify any pressing problems that may need to be resolved, and judge whether a market has become competitive and lighten the regulatory approach accordingly. The publication of general guidelines in certain key areas can also work to deter anti-competitive behaviour and help achieve faster resolution when specific cases occur. 4.21 Even when decisions need to be made quickly it is important that regulators respect the need for transparency and due process. It has been suggested that powers to impose interim measures under the new Competition Act, will facilitate a balance between the need for haste and the need for thoroughness in reaching a final conclusion. Interim measures may be used where, for example, there is a reasonable suspicion that one of the prohibitions has been infringed and there is a need to act as a matter of urgency to prevent serious, irreparable damage to a person or category of persons or to protect the public interest. Powers 4.22 Current legislation available to deal with competition problems in e-commerce is the Competition Act 1998 which came fully into force on 1st March 2000. This is being administered by OFT and concurrent regulators. The Act provides tools to deal with anti-competitive practices by a dominant undertaking under Chapter II and Chapter I enables action to be taken against anti-competitive agreements. OFTEL has concurrency powers for telecoms related issues. The complex and scale monopoly provisions of the Fair Trading Act have also been retained alongside the new Competition Act. 4.23 Under provisions in the Fair Trading Act relating to mergers and acquisitions the OFT and the Competition Commission have the powers to investigate and either impose conditions on, or prohibit, mergers. Mergers are a matter for OFT, CC and DTI, although OFTEL’s advice would be sought where relevant. These provisions do not apply where a merger is caught by EC Merger Regulations. 4.24 OFTEL has powers under the Telecommunications Act 1984 to regulate communications networks and services. The scope covers not only traditional telephony networks but also modern data networks and broadcasting networks (retail services which are broadcast – notably radio and television – are outside OFTEL’s responsibilities). Many of the detailed rules now in place derive from European directives. In the case of dominant operators (BT for many aspects of telecoms networks and services; Sky Subscriber Services Ltd for conditional access to digital television), the conditions of authorisation address comprehensively practices which may damage competition. Less onerous obligations are placed on operators with a lesser degree of market power (for example, Cellnet and Vodafone). Rules imposed on operators without market power are the minimum necessary to ensure consumer interests are fully satisfied (e.g. end-to-end interworking of telephony services, obligations on voice telephony providers to provide access to the emergency services). 4.25 The DGFT also has responsibilities for consumer protection under the Fair Trading Act, in particular, to inform consumers, and to encourage codes of practice which safeguard and promote the interests of consumers. In this role the DGFT is working with other bodies to promote, amongst other things, a secure web environment where consumers can easily identify trustworthy businesses working to high standards of consumer care. Previous Experience 4.26 None of the behaviours identified in this Study would in themselves necessarily be undesirable (indeed they may provide a spur to innovation and drive down prices through increased efficiency). But, as in other markets, problems may arise where behaviour creates or protects market power, or a player with market power extends its position into adjacent markets and distorts competition in those markets or abuses its position by restricting access to or charges excessive prices for essential services. 4.27 Neither OFT nor OFTEL can say precisely at this stage whether they would need to take action if these issues were to emerge. Any issues would have to be considered on a case-by-case basis taking into account the market conditions at that time. Detailed rules at this stage would be more likely to do harm than good given the uncertainty about how the markets will develop. 4.28 Cases would, however, be assessed according to the general principles as set out in the published guidelines to the Competition Act, and it may be useful to provide further guidance relating specifically to fast-moving markets. Past and current cases also give an indication as to how these principles would be applied to e-commerce markets. 4.29 The history of the telecoms industry generally means that competition concerns and thus OFTEL activity is more likely to be centred around traditional markets, particularly in preventing leverage of market power by incumbent operators from one area into another. But while newer markets seem currently to be largely competitive, dominant players might emerge and competition issues might arise within these newer markets in the future that OFTEL would need to investigate. Competition issues relevant to OFTEL’s role include:
4.30 Recent applications of OFTEL’s powers that may give a steer towards handling of future e-commerce issues include:
4.31 OFT is ready to act on any circumstances caught by the Competition Act or the Fair Trading Act in any market not specifically covered by the concurrency arrangements with OFTEL. These might include:
4.32 As discussed, fast-developing markets raise some difficult policy issues given the uncertainty about how markets will develop and therefore the degree of competition that there is likely to be in th | ||||||||||||||||||||||||
