[Macro view]
The Information Society Trends shows up in my email about every 2 weeks and gives a good global overview of what's going on in telecommunications and Internet related issues. This time it's pertinent to e-commerce.
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Information Society Trends
Issue number: 77 - (12.1.1998 - 11.2.1998)
EDITORIAL
Commission calls for International Charter for the on-line
economy
On 4 February 1998, the European Commission adopted a
Communication on "Globalisation and the information society: The
need for strengthened international coordination" which aims to
launch an international debate on how to improve coordination of
world-wide policies affecting the global on-line economy. The
Commission argues that a multilateral framework is necessary to
tackle the technical, legal and social challenges of the
borderless electronic marketplace. This could lead to the
adoption of an International Charter by the end of 1999.
The Charter would set a framework for international policy
cooperation on global communications issues, particularly in the
area of electronic commerce, thereby responding to the need to
streamline the many existing activities at international level.
As initial steps in a consensus-building process involving
government, industry and consumer groups, the Commission intends
to organise a round table at expert level in the course of 1998,
and proposes to hold an International Ministerial Conference.
Businesses and consumers can only take full advantage of the new
opportunities offered by global communications if obstacles and
uncertainties are removed. Electronic commerce is forecast to
reach over 300 billion ECU by the year 2002. But the borderless
nature of the rapidly growing on-line economy will require
clarification and in some cases adaptation of existing
"off-line" rules to the "on-line" world. Issues such as
taxation, data and consumer protection, copyrights, encryption
and digital signatures, the Internet Domain Name System and
Internet governance require urgent attention.
The European Union (EU) has already begun to formulate several
policy lines on electronic commerce by stimulating the
development of an internal market for electronic services whilst
safeguarding public interests. In parallel, bilateral and
multilateral initiatives are being pursued at national and
regional levels, and by a growing constellation of international
organisations and bodies.
Against this background, the initiative does not call for the
creation of a new international body, nor for additional
regulation. It argues that more coordination is necessary
between the many different entities concerned in order to help
avoid unnecessary regulation and calls for stronger involvement
of the private sector, consumers and the social partners. The
Commission suggests that the EU should strive to contribute its
vision on the information society at a global level, notably by
promoting fair competition, private sector investments, and open
markets, accompanied by appropriate public interest safeguards.
The Commission invites all interested parties to e- mail their
comments by 31 March 1998 to eif@bxl.dg13.cec.be (Available
on-line: ispo.cec.be
EUROPE
Trends: The emphasis is on the European Community with a series
of important steps regarding a global Internet Charter (see
editorial), Internet telephony, GNSS and the Fifth Framework
Programme. At market level, the main news is the teaming-up of
Cegetel, Canal+, AOL and Bertelsmann in the French Internet
market, and of Havas, Bertelsmann, World Book Publishing and IBM
in multimedia content.
MULTIMEDIA SERVICES AND PRODUCTS
The leading UK telecoms operator BT and America's VeriSign, a
world leader in digital certificates, have agreed to launch in
Britain in the Spring of 1998 a range of corporate and
residential digital certificate services for secure electronic
commerce over the Internet. The services would allow users to
send and receive digitally-signed and encrypted e-mail, thus
allowing to protect data confidentiality and to check the
integrity of messages. The services would be fully compatible
with the VeriSign Trust Network (VTN), a global network of
corporate digital certificates for use on the Internet which has
1.5 million customers. BT and VeriSign would also establish a
certification authority in the UK to issue, authenticate and
manage digital certificates.
*****
The French software company Audiosoft has finalised a
distribution agreement with Telindus, a European group
specialised in the integration of telecoms systems for
corporations, telecoms operators and cable TV operators. The
move would allow Audiosoft to make its Internet-based
interactive music service, City Music Network, available to
cable TV subscribers that enjoy high-speed Internet access over
cable networks in Belgium, Luxembourg, Switzerland and the
Netherlands. City Music is already supplied by the French cable
TV operator Lyonnaise Cable. All together, 100,000 Internauts
would be able to access City Music by the end of 1998.
LEGISLATION AND POLICIES
The European Commission has adopted a notice defining its policy
on voice telephony in respect of telephony over the Internet.
The notice considers that Internet telephony is not subject to
the regulation applying to voice telephony until certain
conditions are met. The provision of Internet telephony may
therefore not be subject to European Union Member States
individual licensing procedures but at the most to declaration
procedures
(http://europa.eu.int/en/comm/dg04/lawliber/en/voice.htm).
*****
The European Commission has adopted a strategy to ensure a full
European role in the development of Global Navigation Satellite
Systems (GNSS), a market estimated to be worth over 43 billion
Ecu by 2005. GNSS offers a huge potential for improving the
safety and efficiency of all modes of transportation. But the
use of existing systems, the Global Positioning System (GPS) and
Glonass, currently remains respectively under US and Russian
military control. The Commission therefore set three options for
the future: joint development of GNSS by all major players;
development of GNSS by the European Union and one or more global
partners; independent development by the EU.
*****
The European Commission has adopted a revised proposal for the
Fifth Framework Programme for research and development based on
the views expressed by the European Parliament and the Council
of Ministers (available on-line:
cordis.lu.
*****
The European Commission has cleared the acquisition by Germany's
Mannesmann of a controlling interest in the Italian telecoms
operator Infostrada. Infostrada is a joint venture which was set
up by the US telecoms operator Bell Atlantic and the former
Italian computer giant Olivetti, but Bell Atlantic has recently
decided to sell its stake.
*****
The French government has adopted an Action Plan for the
information society which focuses on six priority lines of
action: new technologies in education; culture policy; the
modernisation of public services; new technologies for
businesses; industrial and technological innovation; and an
efficient regulatory environment.
*****
The Ukrainian government has said it would privatise 5% to 25%
of the state-owned national telecoms operator UkrTelecom in the
second semester of 1998.
MARKET AND COMPANIES
France's largest private telecoms operator, Cegetel, and the
French pay-TV giant Canal+ have agreed to merge their Internet
activities. This would also include the Internet activities in
France of America OnLine (AOL), the world's largest commercial
on-line service, and its partner, the German media giant
Bertelsmann. The venture, which would be the sector's leader in
France, would focus on five activities: Internet telephony,
corporate services, advertising, electronic commerce and
interactive TV.
*****
The French, German and US publishing groups Havas, Bertelsmann
and World Book Publishing and the US computer giant IBM have
announced that they would join forces within a multimedia
consortium to produce and market high-quality multimedia content
using state-of-the-art technology, in particular tri-dimentional
imaging.
*****
O.tel.o, a new entrant in the German telecoms market, has
announced that it has signed up the German Roman Catholic and
Protestant churches and their charity organisations, a market
that is estimated to be worth 435 million Ecu a year.
NORTH AMERICA
Trends: US news are dominated by Compaq's take-over of Digital
and by the Supreme Court's decision to review parts of the 1996
Telecoms Act.
LEGISLATION AND POLICIES
The US Department of Commerce has released a draft proposal
suggesting ways to improve the management of the Internet Domain
Name System (DNS) by establishing a private sector policy
oversight body and introducing competition into the domain name
registration system. The document aims is to spark a large
debate with interested parties.
*****
The US Supreme Court has agreed to take up several appeals filed
by the US Federal Communications Commission (FCC), the US
Department of Justice and several US long-distance operators
such as AT&T and MCI. They challenge in particular the rulings
of the Eighth US Circuit Court of Appeals in St. Louis, which,
in 1997, rejected FCC rules on grounds that the FCC overstepped
its authority in areas that fall under state responsibility, in
particular network interconnection charges and leased lines. The
St. Louis Court's rulings created uncertainty and delayed the
full liberalisation of the US telecoms market under the 1996
Telecoms Act. But the Supreme Court's move will not clarify the
situation for a while longer as it will not hear the cases until
the fall of 1998 and since a decision is unlikely to be reached
before a year.
MARKET AND COMPANIES
The US PC manufacturer Compaq has agreed to spend $8.7 billion
on purchasing its US counterpart Digital Equipment, the biggest
deal to date in the information technology (IT) sector. The move
would turn Compaq into the world's second-largest IT group with
$37.5 billion in annual revenues after IBM and ahead of Hewlett
Packard. The venture would allow Compaq to cover the entire
range of IT products. It would in particular strengthen its
presence in the corporate market, where it would benefit from
Digital's leadership in work stations and servers. The remaining
gap in Compaq's market reach compared to IBM would be software,
from which IBM draws $12.8 billion of its $78.5 billion annual
revenues. However, this could be largely offset by Compaq's
close ties with the US PC software giant Microsoft.
SOCIAL, SOCIETAL AND CULTURAL
Netscape Communications, the world's leader in Internet browser,
has announced plans to axe up to 15% of its 3,200 strong
workforce. Netscape also said that it would consider selling
part of all of its activities. This follows the company's
announcement that it would, for the first time, post a loss for
the last quarter of 1997. This could largely be a result of
heated competition with the world's leader in PC software,
Microsoft, which has grabbed a significant share of the browser
market by offering its Explorer browser for free. But Nestcape
said it would fight back by also releasing its Communicator
browser for free.
ASIA AND PACIFIC
INFRASTRUCTURE
The Japanese and UK telecoms operators Nippon Telegraph and
Telephone (NTT) and Cable and Wireless (C&W) said they have
agreed to set up a joint venture specialised in submarine
telecoms cable in Asia. It would be comprised of NTT's maritime
cabling operations and be owned 15% by C&W Marine.
LEGISLATION AND POLICIES
The UK and US telecoms operators BT and WorldCom have applied
for "Type I" telecoms licenses which would give them the
privileges of a public telecoms operator in Japan, including the
right to build their own network. Both companies said they
intend to offer telecoms services in Japan. WorldCom also
unveiled plans to develop its own fibre- optic network in Tokyo
to offer corporate communications services before year-end.
WorldCom has already developed and interconnected high-speed
networks in major US and European financial centres through its
subsidiary MFS Communications.
*****
The Japanese Ministry of Posts and Telecoms (MPT) is preparing
plans to introduce terrestrial digital broadcasting in Japan
starting in the Tokyo area in the year 2000 and progressively
covering the whole country by the year 2006. Licenses would be
issued to either programme producers or broadcasters.
*****
The Japanese Fair Trade Commission, the country's competition
watchdog, has opened an investigation into US software giant
Microsoft for allegedly having restricted the use by Japanese
computer manufacturers of competing application software.
LATIN AMERICA
LEGISLATION AND POLICIES
The Colombian Telecoms Regulatory Commission has awarded a
license for the provision of long-distance and international
services to a local telecoms operator owned by the municipality
of Bogota, Empresa de Telecomunicaciones de Bogota, thus
breaking the monopoly of the national operator, Telecom.
WORLD-WIDE
LEGISLATION AND POLICIES
The World Trade Organisation (WTO) announced that the WTO Basic
Telecoms Agreement entered into force on 5 February 1998. The
accord, which has been signed by 72 nations, accounts for 93% of
the global telecoms market worth over 500 billion Ecu.
SOCIAL, SOCIETAL AND CULTURAL
The number of Internet users reached close to 200 millions at
the end of 1997, according to the Internet Industry Almanach, a
publication of America's Computer Industry Almanach Inc.. The
USA is still dominating Internet use with over 54%, but this
share has declined rapidly from 65% in 1994, and is expected to
drop to 40% by the end of 2000. Europe amounts to 22% of the
total and Japan 8%. Overall, 15 countries, mostly highly
industrialised ones, account for 90% of Internet usage.
Also available electronically:
ispo.cec.be E-mail subscription:
Majordomo@www.ispo.cec.be; enter SUBSCRIBE ISTRENDS + your
e-mail address
************************
European Commission, Directorate General XIII, Advisor's Team.
Supervisor: Detlef Eckert. Chief editor: Denis Baresch.
Editorial committee: Gerard Carat, Tim Fenoulhet, Christian
Micas. The contents of "IS Trends" are based on publicly
available information, in particular news articles and press
releases, and do not necessarily reflect the opinion of the
European Commission. |
