<strong>The</strong> <strong>Hungarian</strong> <strong>Communications</strong> <strong>Market</strong> <strong>Developments</strong> <strong>and</strong> Regulation between 2004 <strong>and</strong> 2008 as early as in a few years’ time. With the introduction of new services <strong>and</strong> the most recent compression technology into the market, we have taken a very important step. Hungary was among the first countries in the region to join the digital Europe. This process is expected to conclude in the EU countries by the end of 2011. Today at least one million people are affected by the switchover, as roughly this many persons are watching analogue terrestrial programmes using indoor or rooftop aerials. However, switchover is important also for those not directly affected, as the terrestrial digital platform will hopefully become competitive with other technologies <strong>and</strong> will contribute to the quality improvement of television services <strong>and</strong> concurrently generate lower prices. <strong>The</strong> launch of terrestrial digital platform in fact entails the introduction of a competitive infrastructure, <strong>and</strong> this way, in our view, sustainable market competition will be shaped by the competition of services <strong>and</strong> infrastructures. Since 2004, we have been continuously seeking opportunities for cooperation with market players: we held professional consultations on our draft decisions, had debates on our regulatory strategy for the period between 2006 <strong>and</strong> 2010, <strong>and</strong> consulted market players with reference to a number of professional matters. Currently VoIP <strong>and</strong> NGN consultations are also on the agenda. VoIP – the Internetbased voice communications technology – is already used by many, with the spread of new generation networks just around the corner. Within a short time, these technologies will fundamentally change both communications <strong>and</strong> its regulation. Our goal is to create a regulatory environment in this field that is not only attractive for investors but also provides guarantees for sustaining competition <strong>and</strong> protecting consumer interests even after the spread of the new technology. All of these subjects are on the agenda in the work of ERG/IRG under our presidency in 2008 <strong>and</strong> are also featured on the agendas of other EU forums. It is the recognition of NHH’s work, i.e. the regulation of the <strong>Hungarian</strong> communications market that resulted in the fact that Hungary has been awarded with the 2008 presidency of ERG/ IRG. <strong>The</strong> one-year-long presidency concluding at the end of 2008 was primarily about seeking consensus <strong>and</strong> making the work of an organisation uniting the regulators of 27 Member States more efficient in a period characterised by issues to be addressed such as the reform of the European regulatory framework, the protection of European consumer interests or roaming. <strong>The</strong> most impressive results were made in the field of roaming regulation through altering the former unregulated, non-transparent regime maintaining surrealistic price differences into a transparent system that is for the benefit of consumers. We managed to cut down voice roaming tariffs by cutting back unjustifiably high former profit levels, <strong>and</strong> chances are high that by summer 2009 SMS retail prices will also be regulated <strong>and</strong> will be some 60 percent lower than today. As for mobile Internet, the first step will be the regulation of wholesale prices in the summer of 2009, <strong>and</strong> later hopefully no intervention will be required in retail prices. In the debate on the regulatory framework, NHH <strong>and</strong> ERG/IRG share the same objectives of protecting <strong>and</strong> increasing the independence of regulators, making efforts for European regulation to be faster <strong>and</strong> more harmonised <strong>and</strong> making arrangements for national regulators to use primarily uniform models throughout the continent while relying on local knowledge. In 2009, the ERG/IRG presidency will be followed by another presidency in RSPG, the European Commission’s advisory group on radio spectrum policy, which will allow the two professional organisations to get closer to each other also through my person <strong>and</strong> NHH. One of the first RSPG duties will be to formulate proposals for a more effective future utilisation of European frequency assets with the elimination of the digital divide featured high on the agenda. Europe’s goal is to make broadb<strong>and</strong> access available to everyone. This is partly why Europe needs a wireless broadb<strong>and</strong> strategy, as it is apparent that this technology will assume a key role in bridging the divide. National challenges are similar to international ones. We are facing postal liberalisation, the management of the digital switchover process, a new media act, the implementation of the amendments of European regulations in national practice, <strong>and</strong> of course further fostering of competition in the communications market. In the past years, we increasingly strengthened our cooperation with the <strong>Hungarian</strong> Competition Authority, the <strong>Hungarian</strong> Authority for Consumer Protection <strong>and</strong> the National Radio <strong>and</strong> Television Board. We are involved in the regulation of media infrastructure <strong>and</strong> are determined to remain a reliable source of information for consumers, promoting consumer awareness <strong>and</strong> assisting information provision with reference to the communications market. Below, you will find a detailed presentation of the processes outlined above. You can have a closer look at what <strong>and</strong> why we have done, <strong>and</strong> how the <strong>Hungarian</strong> communications market has changed <strong>and</strong> developed over the past five years as a result of NHH’s market regulation activities. Dániel Pataki President National <strong>Communications</strong> Authority of Hungary
04 05 NHH’s role in the regulation of the electronic communications market 1