ARCEP publishes its report to Parliament and to the government on the electronic communications sector in overseas markets.

Paris, 8 January 2010

Article 28 of Law No. 2009-594, dated 27 May 2009, concerning the economic development of overseas markets, commonly referred to as LODEOM (Loi pour le développement économique de l'outre-mer) stipulates that "The electronic communications and postal regulatory authority will submit to Parliament, no later than nine months following the adoption of the present act, a report on the overseas départements and collectivities where it has jurisdiction which concerns, first, the terms of price formation for electronic communications services, the gaps between real network capacities and the capacities being used and price levels and, second, the terms governing the formation of fixed and mobile telephony service prices. The Authority is particularly interested in excessive billing of roaming calls made to or from the overseas collectivities and between these collectivities".

Moreover, in a letter dated 22 April 2009, the Secretary of State for Overseas France and the Secretary of State in charge of Industry and Consumption requested that ARCEP produce a document that provides a "status report on the development of the electronic communications sector in the overseas départements," and which suggests "measures capable of stepping up this development that would be beneficial to consumers."

Today, the Authority is releasing its report on the electronic communications sector in the overseas markets to the public.

The report reveals a situation of contrasts between the different markets that make up the electronic communications sector. The fixed telephony markets overseas are by and large comparable to markets in mainland France. Mobile services markets in the overseas départements are very competitive and offer users attractive prices, despite an inevitable additional cost tied to roaming-out calls for users travelling between mainland and overseas France. On the other hand, fixed broadband retail market offers are less attractive overseas than in Metropolitan France. This is due to the fact that the overseas markets are smaller and players have to contend with higher fixed costs, and to the bottleneck caused by the necessary use of undersea cables to access the global Internet.

In its report, ARCEP has formulated several proposals and recommendations for enabling the development of more attractive offers in the overseas markets.

- The Authority recommends that more recognition be given to overseas markets in general, and that they be systematically taken into account, which supposes two complementary approaches: first, making a better assessment of the realities of these markets by collecting and disseminating local statistical data and, second, recognising the central role that overseas operators can play in finding and implementing solutions for furthering the development of these markets.

- ARCEP suggests reserving a portion of the digital dividend for mobile services markets, as was done in mainland France.

- As concerns fixed broadband markets.

The Authority suggests, first, that competition mechanisms be improved - for instance by publishing quality of service indicators for wholesale solutions for each département or collectivity.

Second, ARCEP recommends new forms of public involvement:

o in the retail market, changes need to be made to the regulatory framework even more so than in mainland France to allow welfare recipients who subscribe to bundled offers that include a fixed telephone service to benefit from the universal service tariff reduction;

o in the undersea cable market, the Authority recommends:

o finally, to limit the traffic being routed by the undersea cables between mainland France and the overseas départements to only what is strictly necessary, ARCEP recommends encouraging market players - including through public financing if necessary - to install servers in the overseas départements and collectivities for hosting the most popular content.

The ARCEP report also provides stakeholders with a framework for discussions to help them find shared solutions and to facilitate their implementation. Here, the State has a decisive role to play in organising discussions between public authorities and private sector players who, despite being competitors in the retail market, are nevertheless all having to contend with the same challenges and all share the same ambition of developing a high quality offer at affordable prices for our fellow citizens overseas.

An executive summary of the report (in French) is attached to this press release.