Telecom Italia response to BEREC Consultations on Roaming Regulation Choice of decoupling method 10 th August 2012 Page 1 (10)
Executive Summary TI shares BEREC s view that it would be inappropriate to implement costly decoupling solutions taking into account the uncertainty of the competition benefits which can be achieved with their introduction. TI therefore supports the most appropriate implementing solutions is the combination of LBO and basic Single IMSI. TI deems that some technical challenges, such as the introduction of temporary number portability, and management issues, such as the replacement of all customers base SIMs, render very difficult and costly the implementation of dual-imsi SIMs. Also the implementation of Single IMSI+ requires the resolution of a number of issues. The reconciliation of volumes attributable to the ARP and to the Home MNO determines some management complexity and the risk of disputes. In addition, the imposition of wholesale provider by the ARP also for unregulated calls is a regulatory issue that has not been solved. Should BEREC decide to support the Single IMSI+ solution, Telecom Italia maintains that the adoption of a standard Open Mobile Alliance/Service Exposure (OMA/SE) approach could reduce the overall impacts on the industry. The implementation of an OMA/SE approach is desirable also for the Single IMSI solution to allow the TAP management towards the ARP in a standardized way. In particular, OMA/SE, being able to open single capabilities toward ARPs, can be configured so that Home provider continues to manage extra-eu calls whilst the ARP takes charge of the EU calls only. TI maintains that the creation of a unique EUInternet APN for LBO would make it easier for customers to identify the service across Europe and would have positive effects on competition. To improve LBO customer experience, it would be necessary to create incentives for terminal and application providers to develop applications to make APN switching easier and the selection of the available LBO offers more user-friendly. Regarding the choice of the obligations for the implementation of the decoupling solution, BEREC and EC should evaluate the proportionality and the necessity when imposing these obligations. The obligations should be restricted to those necessary to the provision of the roaming service as defined in the Regulation. In particular, it should make clear that the unbundling obligation (art. 4) should be limited to the calls inside the EU. TI considers appropriate the introduction of an additional obligation of setting steering passivation for each single customer who wants to use an LBO offer. This can facilitate the selection of the ARP/visited network and improve the customer experience. Introduction Telecom Italia (TI) welcomes the opportunity to answer the BEREC public consultations on Roaming Regulation Choice of decoupling method. The debate on how to best deliver the results hankered by the introduction of a structural solution, which will in the long run replace the price regulation, has been passionate and has in the last months brought all shareholders to contribute with their ideas and technical analysis to the definition of the best implementing solution. This long process has produced a fair idea of the pros and cons of the examined solutions, which are well reflected in the BEREC document, and has allowed reaching a certain consensus within the Industry and among the European Institutions on the right path to follow. Page 2 (10)
TI shares BEREC s view that the uncertainty as regard the results that can be achieved with the decoupling, coupled with the complexity of combining different structural solutions (as foreseen by the Regulation) should naturally lead to the selection of methods of decoupling [which] provides a reasonable prospect of delivering competition benefits sufficient to justify the implementation costs. In particular, it would be inappropriate to implement a costly solution in the absence of guarantees of significant competition benefits. 1 TI therefore supports the combination of the basic version of the LBO and the basic Single IMSI as to be the most appropriate implementing solutions. TI deems it very important that BEREC urgently issue draft guidelines detailing the obligations of the MNOs and of the Alternative Roaming Providers (ARP) in relation to the selected unbundling solutions. In this respect, TI welcomes that BEREC formally seeks shareholders advice on operational issues defined in the guidelines with a dedicated public consultation. The obligations and rules imposed on the operators should not go beyond what the Regulation provides for. In particular, it should make clear that the unbundling obligation (art. 4) should be limited to the calls inside the EU. The effort required by the stakeholders (MNOs and ARP) will certainly be important and it is vital that precise rules are set out as soon as possible, considering the very limited timeframe for the implementation of the identified solutions. Local Break Out (LBO) Q1. Do stakeholders agree that the basic version of LBO should be introduced in July 2014? What are the elements that may hinder or facilitate the diffusion? Telecom Italia agrees with the introduction of the basic LBO Visited network competition model by July 2014, as TI is convinced this solution will improve roaming competition for customers' benefit as well as it will accompany the European mobile market towards the mobile broadband evolution. Considering the clear evidence that LTE represents a crucial step toward European Digital Agenda broadband goals, it is central to carefully consider all the elements that can facilitate or hinder a successful LBO deployment. Indeed, TI maintains that LBO represents the central innovation in the European roaming evolution; the main reason being that LTE is LBO based in the ETSI 3GPP standards, contrary to other decoupling methods, which are based on a legacy approach. Roaming decoupling is a worldwide enhancement which places Europe as the trend setter. If Europe will fail this process, it is easy to predict that LBO innovation will remain limited to the Wi- Fi context (no continuous coverage, no mobility and no leading European role). Considering the very limited implementation timeframe, TI fears that operators efforts will be fragmented to abide by the obligations pursuing two completely different decoupling models (e.g. Home based and Visited based). 1 Roaming Regulation Choice of decoupling method, page 3. Page 3 (10)
Although TI understands that the combination of two different solutions is a requirement of the Regulation, TI believes it might be detrimental as it risks imposing an excessive burden on operators and might even confuse customers. TI therefore fully supports BEREC in its attempt to find the simplest solutions for both local provision of data services and the decoupling of voice, SMS and data services. With reference to specific technical elements that would facilitate the diffusion of LBO, TI maintains that the creation of a unique EUInternet APN (similarly to IMS APN described in GSMA Guidelines IR.65, IR.88 and IR.92) would make it easier for customers to identify the service across Europe and would have positive effects on competition. Q2. Should co-operative efforts be made to develop a more user-friendly version of LBO for subsequent evolution? What kind of efforts would be most productive? Could you provide any cost estimations for the development of user-friendly interfaces? Can BEREC assist with this process? From the customer perspective, the success in an IP environment depends on a mix of factors bound to terminal, network and application/server characteristics. Indeed, in the current IP model the services do not rely only on network services provided by the Telco Operator (like 2G/3G voice was). Hence, cooperation between the several elements of internet chain is necessary, especially if one considers that LTE is an All-IP infrastructure. Cooperation can be differently approached in the terminal, in the network and in the application/server sides. On the terminal side, user-friendliness mainly refers to easiness of network selection (remaining on the selected network during roaming can also improve LBO user-friendliness) and APN setting. Both aspects have basically no technical constraints in term of feasibility within the terminal and also no specific cost issues. Therefore, to improve LBO experience on the terminal side, it is important to create a European environment where this type of terminal features becomes important and visible to the customer so that the terminal and application providers will have incentive to develop applications which will make APN switching easier and the selection of the available LBO offers more user-friendly. On the network side, it is important that HLR configuration leaves customer free to easily switch between LBO-Visited or Classic-Home Routed offers, without complicate the setting during the travel or when back to home under the Home network coverage. In this respect a unique EUInternet APN benefits both terminal application (e.g. no need to maintain an APN LBO table in the terminals associating specific LBO APNs for each European MNOs offering the service) and network configuration. A further LBO user-friendliness improvement could come from the possibility to add the Homecredit based payment option. This indeed could also represent a commercial opportunity for Home operators, who would maintain a relationship with their customers even if abroad they select an LBO offer of a different operator. This topic, though, is more related to commercial aspect and would not in our view require the introduction of specific regulatory provision. Q3. Are there any measures which BEREC could consider to facilitate the ability of MVNOs and resellers to offer LBO? If so, can you provide clear evidence on the technical feasibility and the costs which would arise from such measures? Page 4 (10)
TI thinks that it is not necessary to impose specific obligation to facilitate the ability of MVNOs and resellers to offer LBO. In principle, when considering an Enhanced Service Provider (ESP), which uses the SGSN and GGSN of the MNO, the LBO service will be managed by the MNO itself, with possible customization for the management of billing flows. The same scenario applies to resellers. In the case of Full MVNOs, who have their own GGSN, the network chain will be composed by the access network and SGSN of the Host MNO and by the MVNO GGSN, who will directly manage the LBO offer. DUAL IMSI Q4. Do you agree that Dual IMSI should not be implemented in July 2014? Telecom Italia agrees with BEREC s recommendation that dual IMSI should not be implemented by July 2014. Indeed, the technical challenges of this solution seem insurmountable in this short timeframe and in any case TI deems the effort required too important compared to the expected benefits in terms of competition enhancement and price reduction. When TI first examined the Dual IMSI solution a few months ago, it reported, inter alia, the following challenges: Logistic issues: replacement of all customers base SIMs with dual-imsi SIMs; production and provisioning of SIMs with all possible combinations of MNO+ARP; Technical/regulatory issues: introduction of temporary number portability; definition of new standards for HLR interfaces; Security issues: need to share sensitive data among competing MNOs; impacts on lawful interception. SINGLE IMSI / SINGLE IMSI+ Q5. Can you provide clear evidence on the feasibility and the costs which would be involved in making access to traffic steering possible (within the normal limits of steering technology) via Single IMSI + by 1 July 2014. (Any information you provide will be treated by BEREC as commercially sensitive, if you prefer). Telecom Italia deems that the technical challenges specifically related to the management of incoming voice calls and data traffic make the standard Single IMSI+ solution not feasible in the near future and certainly not within the implementation date foreseen by the Regulation. The above difficulties are not valid for the Single IMSI+ light solution as it does not need the implementation of Camel. Nevertheless, from a technical point of view, Single IMSI+ development Page 5 (10)
remains complicated as it depends on specific Home implementations, due to lack of standard references to uniformly open IMSI Home internal mechanisms to external MNO/MVNO ARPs. Therefore there are objective obstacles for ARP to create the expected competition level as ARP would need to adapt to multiple Single IMSI implementation of Home networks. In the Single IMSI+ scenario, ARP will be in a position to negotiate discounts with the visited networks only if it can guarantee that its customers will roam on the selected visited network. This is done by imposing the ARP steering policies to the Home MNO. Lacking a standard, the level of complexity of the steering will highly depend on the adopted solution. For instance, steering solutions based on HLR profiles (for example with the definition of static VPMN allowed lists) increase significantly the number of HLR profiles and are very hard to manage (for example each time the ARP requires a change in the VPMN lists). Moreover, as correctly outlined by BEREC 2, the implementation of this solution would bring several management challenges (and related cost increases) as the ARP s traffic steering policies would have an effect on volumes (and therefore discounts) of the Home MNO, which would complicate its relationships with the visited network and require a multi-step approach with regard to bill settlement. Additionally, the reconciliation of volumes attributable to the ARP and to the Home MNO would further increase the complexity and the risk of a rising number of disputes. Finally, the imposition of wholesale provider by the ARP for unregulated calls, as highlighted by BEREC itself, is a regulatory issue that should be solved before selecting Single IMSI+ as one of the alternative decoupling options. Even if a feasible and not costly solution were identified for Single IMSI+, Telecom Italia doubts that the volumes the ARP can move towards the selected visited network will ever be large enough to allow better discounts than those negotiated by the Home MNO itself; therefore, the expected difference in incremental competition in comparison with the basic Single IMSI is in our view negligible. For all the reasons above, TI strongly opposes the selection of a solution that would imply an excessive effort from MNOs and recommends the adoption of the basic Single IMSI solution. However, should BEREC decide to support the Single IMSI+ solution, Telecom Italia maintains that the adoption of a standard Open Mobile Alliance/Service Exposure (OMA/SE) approach could reduce overall industry impacts, facilitate ARPs competitions and also enable cross usage of Single IMSI+ features. Overall decoupling cost and ARP competition barriers can be both lowered avoiding multiple Home-ARP interfaces, which inevitably lead the Industry to prefer HUB services denying the freedom of choosing between HUB and direct connection. Obligations can focus on the set of specific Service Exposure capabilities to be enabled by each Home MNO, specifying a set of parameters and interface ARP can use. The service exposure approach enables ARPs to use single development for all the subscribers, and Home MNOs to create only one interface for ARPs. Q6. What is your view of the difference in incremental competition benefits achievable, as between implementation of Single IMSI and Single IMSI +? Please provide as much justification as possible for your view. Q7. Do you agree that a version of the Single IMSI family should be implemented in July 2014? Which elements are key to a successful implementation? 2 Roaming Regulation Choice of decoupling method, page 11. Page 6 (10)
Q9.Do you consider that there could be further enhancements to Single IMSI+, beyond the ones considered in this paper? (including elements that could simplify implementation and increase feasibility)? Please comment on the additional implementation costs and competition benefits. Telecom Italia is convinced that the best way for enhancing competition levels in the roaming market is the Visited network competition model. In the long run, the LBO solution alone will be enough to guarantee this higher competition as, with the wide adoption of LTE, LBO will allow the decoupling of all roaming services (voice, SMS and data) at prices comparable to domestic prices of the visited network. Indeed, already in 2016, LTE is expected to be the driving technology for the mobile market. Whereas LBO can only reach the objective of the Regulation with regard to the data service in the medium term, Telecom Italia maintains that the overall unbundling results can be obtained by integrating the Single IMSI+ solution within the LBO offer, still leveraging the Visited network competition model. Indeed, if the Single IMSI+ solution, implemented using a standard OMA/SE approach, were adopted by ARP already offering LBO solutions in its Visited networks, it would allow Visited networks to offer all roaming services fully independently from the Home MNOs. On this basis, whatever LBO provider in Europe could present its roaming customers offers which include voice and SMS services. The IP data service would be fully based on its own infrastructure (using LBO), and the voice/sms services would be offered with a good degree of independence from the Home MNO, would voice/sms capabilities be opened in the Home network (a standard OMA/SE solution enable ARPs to use a single type of interface for all European subscribers). This solution has also the advantage of being more customers friendly. Indeed, the coincidence of ARP and LBO providers allows the end users to select only one alternative provider to take advantage of lower (potentially similar to visited network) tariffs for all roaming services. On the operators side, the coincidence of ARP and LBO provider allows to overcome all the issues related to the interferences between the steering imposed by the ARP on the selected visited network (or by the Home MNO on the preferred network) and the customer driven steering when the end user selects a particular visited network offering LBO. In this particular regard, TI deems the document prepared by BEREC does not sufficiently cover the additional complexity introduced by the potential selection of an ARP for voice/sms services and an LBO provider for data services. In conclusion, Telecom Italia maintains that the overall costs and complexity increases of introducing a Single IMSI+ solution (even if limited to the Visited network, as proposed above), would not be justified in light of the expected competition improvements, especially considering that in the future LBO will provide also voice and instant messaging provision rendering any other unbundling solution redundant. The basic Single IMSI is to be preferred as it has the additional comparative advantages of not raising any issue with regards to traffic steering policies interferences and with reference to the management of unregulated calls. The implementation of an OMA/SE approach is desirable also for the Single IMSI solution to allow the TAP management towards the ARP in a standardized way. In particular, OMA/SE, being able to open single capabilities toward ARPs, can be configured so that Home continues to manage extra- EU calls whilst the ARP takes charge of the EU calls only. Page 7 (10)
Q8. If steering is not implemented, do you consider that it would nevertheless be practical to implement systems which would allow decoupling providers to have an option to settle wholesale roaming charges directly with the visited network, on the basis of their own wholesale roaming agreements, as opposed to reliance on a roaming resale agreement with the end user s home network? If practical, please estimate the cost (if applicable) to your company of implementing such systems changes. Please also assess the competition benefits which you would foresee. Telecom Italia does not foresee any possible solution for a scenario in which the ARP settles its wholesale roaming charges directly with the visited network where steering is not implemented. Indeed, steering plays a crucial role in the wholesale roaming market and a solution, which is not involving the steering, risks having a limited effect in the market. As stated above, TI maintains that the negotiation power of ARP to obtain discounts on wholesale roaming tariff will be limited even in the case the ARP can demand the Home MNO to steer the roaming traffic of its customers on a specific visited network. Without this lever, TI does not foresee any possible advantage for the ARP. OBLIGATIONS NECESSARY FOR EFFECTIVE IMPLEMENTATION OF DECOUPLING Q10. Do you agree that the obligations listed in Annex 1 are necessary? TI would like to highlight that the obligations, which the EC will impose on MNOs on top of the obligations already imposed by the Regulation, imply not negligible costs for the operators. For this reason, BEREC and EC should evaluate the proportionality and the necessity when imposing the obligations. The obligations should be restricted to those necessary to the provision of the roaming service as defined in the Regulation. The access to other services should be agreed on commercial basis. In particular, TI deems that support for billshock should be agreed and charged on a fair and reasonable basis. Indeed SMS sending and data service cut-off are obligations of the retail provider which should not be sustained by the wholesale provider. Regarding the obligations proposed for the single IMSI solution, TI notes that all the provisions proposed by BEREC can be implemented using the OMA (Open Mobile Alliance) approach of Service Exposure. Bellow there is an analysis for each proposed obligation. Support for customers provision MNOs Service Exposure could expose customers provision functionality to ARPs. Currently Service Exposure exposes functionalities of new SIM provision, profile management, etc. Basic support for ARP billing (post-paid customers): TAPs and CDRs Currently Service Exposure exposes ARPs functionalities for transferring CDRS and TAPS of customers traffic. A similar functionality could be foreseen for ARPs. Basic support for ARP billing (pre-paid customers): On-Line Charging Systems interconnection Page 8 (10)
Service Exposure has functionalities which allow CDRs and UDRs production for accounting and billing of pre-paid and post paid users. Support for billshock measures: SMS sending, data service cut-off when reaching consumer limit Service Exposure has interfaces for SMS sending. It is possible to implement SMS sending to Service exposure for threshold alerts. Through Service Exposure, it is also possible to have traffic data blocking. Complete post-paid billing support for ARPs Service Exposure can be used as mediation between ARP a MNO s IT systems. Q11. Are there any additional necessary obligations or are there obligations that should not be included? TI considers appropriate the introduction of an additional obligation of setting steering passivation for each single customer who wants to use an LBO offer. The use of steering passivation aims to smooth the potential conflicts between Home steering policies and customer willingness, without introducing unnecessary complexity, like in the Single IMSI+ case. Indeed active role in network selection can be played by terminal applications too, so further minimising the complexity and the effort required in its implementation. The definition of the steering passivation procedures should take into account that at the basis of the competition the LBO unbundling there is the customer choice. This means that it is important to have simple and harmonised procedures to let customers express their choice in the network selection phase (Home driven, or customer free). Vice-versa less cost effective appears to introduce an active steering policy. Active steering policies require a stronger need of synchronization among different players, i.e. Home MNO and some different ARPs (customer can skip from an ARP provider to another one, also during a travel). Moreover the coexistence of different active steering policies, for the same IMSI/customer, introduces not only further quality issues, but also extra room for conflicts among Home and ARPs, overcomplicating unbundling implementation without a clear benefit. This is also the reason why Single IMSI+ solution, that by default introduces the need of different active ARPs steering, has a clear drawback in the complexity of coordinating Home steering willingness, ARPs steering willingness and, last but not least, customer willingness. With steering passivation based on customer willingness, only two subjects need to coordinate: the customer who chooses the network/arp and the Home MNO who must passivate the steering. FURTHER DEVELOPMENTS Q12. Do you have any comments concerning future evolution of the decoupling methods? Telecom Italia maintains that the LBO solution is the only decoupling option that is compatible with the future technological evolution. Indeed, from the architectural point of view, LBO perfectly fits Page 9 (10)
the LTE mobile evolution (being already included in the ETSI 3GPP standards) and benefits from the LTE latency excellence. Indeed, in the current Home routing scenario, the IP services not directly provided by specific operators but supplied over the Internet by OTT players (the clear majority today) suffer from an extra latency compared to LTE and LBO latency. This extra latency due to Home routing does not add any value to the customers but it is typically used to maintain a control on IP bit flow by the Home MNO. Page 10 (10)