2. The Authority’s Interventions 2.1. The analysis of electronic communication markets Over the last 12 months, the Authority continued its activities associated with the analysis of electronic communication markets pursuant to the provisions of the Electronic Communications Code. More specifically, in the reference period, the Authority concluded the review of markets of voice call termination in individual mobile networks and of access and origination of calls in public mobile networks, while the procedures for the analysis of another 14 markets in the fixed and mobile telephony segments and of the market of broadcasting transmission services for the delivery of broadcast content to end users are under way. Concurrently, on 19 June 2008, the Authority received from Telecom Italia S.p.A. a proposal for commitments presented pursuant to law no. 248/2006 in relation to a few sanctioning proceedings and regulatory procedures and, in particular, the proceeding on the access network, initiated by resolution no. 626/07/CONS. The evaluation of such commitments by the Authority was made in accordance with the terms established by resolution n. 131/08/CONS, in compliance with the principles of transparency and participation, and was completed on 11 December 2008 by resolution no. 718/08/CONS. Below are the details of activities of the procedure related to the assessment of the proposal for commitments presented by Telecom Italia and of the further activities carried out by the Authority in its analysis of electronic communication markets. Evaluation of Telecom Italia’s proposal for commitments On 19 June 2008, Telecom Italia presented a preliminary proposal for commitments in relation to a few sanctioning proceedings and regulatory procedures pursuant to law no. 248/06. In particular, the commitments related to the following market analysis procedures: i) access to the fixed network (markets 1, 4 and 5 of recommendation 2007/879/EC), ii) national and international telephone services supplied at fixed locations (markets 3, 4, 5 and 6 of recommendation 2003/311/EC), iii) wholesale and retail leased lines (markets 7 and 14 of recommendation 2003/311/EC and market 6 of recommendation 2007/879/EC), which procedures were respectively started by resolutions nos. 626/07/CONS, 133/08/CONS, 145/08/CONS, 183/08/CONS and 184/08/CONS. On the other hand, the sanctioning proceedings to which the proposal for commitments relates were those initiated by resolutions nos. 4/07/DIR, 1/08/DIR, 2/08/DIR, 62/07/DIT, 63/07/DIT, 2/08/DIT, 3/08/DIT and 7/08/DIT. In Telecom Italia’s intention, the proposal took account of the results of the public consultation under resolution no. 208/07/CONS on the “Opening of a public consultation on the regulatory aspects related to the structure of the fixed access network and the prospects for the broadband next generation access networks (NGANs)” as well as of the commencement of procedures for the analysis of markets of access to the fixed network as per resolution no. 626/7/CONS, and suggested ways to supplement and strengthen the provisions of resolution no. 152/02/CONS on equal treatment, so as to promote increased competition in the markets of access to the fixed networks and all markets associated therewith. 121 Annual Report on Performed and Scheduled Activities 2009 The proposal was further intended to eliminate the underlying causes and the consequences of Telecom Italia’s behaviours contested by the Authority in the foregoing sanctioning proceedings and fundamentally corresponding to the following practices: i) allowing network technicians to perform ADSL service marketing/sales activities to its customers; ii) failing to take all organisational steps required for administrative and accounting segregation and transparency in order to separate network management units from final-service sales units; iii) deactivating - in several cases - the carrier preselection service with Wind Telecomunicazioni S.p.A. without an express request to that effect from the customer concerned, and deactivating - in several cases - the same service without sending the notices required by the applicable regulation; iv) finally, activating unrequested services. As a result, by resolution no. 351/08/CONS of 25 June 2008, the Authority started a procedure intended to assess such proposal and – pursuant to art. 2 of the regulation on commitments no. 645/06/CONS (hereinafter the “regulation”) – suspended the terms of the proceedings related to such commitments. On 24 July 2008, Telecom Italia presented its definitive version of its proposal for commitments, which was published on 29 July 2008 on the Authority’s website in order to allow third parties to submit their observations and remarks in such respect. Following the public consultation, on 29 October 2008, Telecom Italia presented its own remarks in reply to the observations made by third parties and concurrently compiled a new version of its proposal for commitments containing important changes and supplements to its previous version. With due account taken of the results of the public consultation, the Authority observed that, notwithstanding the appreciable and significant improvements contained in the new proposal for commitments, the measures proposed by Telecom Italia, as amended on 29 October 2008, were still insufficient to ensure a comprehensive and decisive structural improvement in the competitive conditions of fixed-network access markets and the markets related therewith. In particular, the Authority contended that it was necessary for Telecom Italia’s commitments to: i) envisage further measures for the transparency of pricing of intermediate services; ii) better specify the functions, structure and terms for the functioning of the Monitoring Board under commitment-group no. 7; iii) ensure the maximum level of next generation network (NGN) openness and facilitate the process of transition towards such network; iv) envisage Telecom Italia’s submission to the Authority for approval any revision of or change to its internal operations and functions; v) envisage Telecom Italia’s membership in a body for the settlement of disputes arising from or associated with provision of access services and in an NGN Committee to be instituted by the Authority and – finally – vi) contain measures intended to contain disputes with users. As a result, pursuant to art. 5 of the regulation, the Authority invited Telecom Italia to amend its proposal for commitments in the light of the evaluations and indications listed in the six points above. In reply to the Authority’s requests, Telecom Italia introduced further significant changes to its proposal for commitments, and notified the same to the Authority on 5 December 2008. 122 2. The Authority’s Interventions On 11 December 2008 – after having assessed that Telecom Italia additions and changes to its proposal met its previous requests and that, as a result, the overall proposal for commitments contributed to improve the competitive conditions of the sector through suitable and stable measures and remove the anticompetitive conditions inherent in the offences assessed in the sanctioning proceedings in question – the Authority approved such commitments and made them binding for Telecom Italia S.p.A. by resolution no. 718/08/CONS. The commitments made by Telecom Italia in its proposal can be summed up as follows. i) Open Access and SMP Services The services covered by the commitments are “SMP” (Significant Market Power) access services, i.e. services of wholesale access to the fixed network to be provided on regulated terms based on the results of market analyses. In February 2008, Telecom Italia instituted a new functional unit named Open Access, whose main task is to manage, plan, develop and rationalise the access network. The Open Access unit is only covered by the commitments hereof to the extent that Telecom Italia undertook to preliminarily notified the Authority of any revision, change and/or reorganisation of its internal operations or functions, and to perform any revision, change and/or reorganisation with a significant impact on its commitments only after receiving the Authority’s approval to that effect. The Open Access unit will directly provide SMP services to Telecom Italia’s sales division and its wholesale sub-division, which will continue to constitute the only contact with alternative operators (hereinafter OLOs) for the provision of the foregoing services. ii) Commitment-group no. 1 (institution of a new delivery process and a new wholesale-customer management system) Telecom Italia will implement a new consolidated delivery process for the management of its relationship with its internal and external customers. Any orders related to activation, deactivation, variation and migration of all of SMP services covered by the commitments will be handled with a degree of priority that will be based on the order of placement (i.e. on a first-come-first-served basis) and will be organised in a set of queues to be differentiated in accordance with the type of service, the quality level selected at the time of placing the order and the technical complexity of related interventions. In case of unavailability of network resources for the requested service, the applying OLO will ask Telecom to isolate the order in a single-queue waiting list based on resources rather than on services, which will gather orders related to all SMP services of OLOs as well as of the Telecom Italia RETAIL sub-division. Telecom Italia further undertook to put in place a new ‘Customer Relationship Management’, or CRM, wholesale system for the technical and commercial management of relations between OLOs and the Telecom Italia’s Wholesale Sub-division, specifically with regard to the provision of SMP and co-location services. Such system will help OLOs perform, among other things, a pre-sales analysis, i.e. be informed on line on the availability of the resources required for the execution of contracts with end customers and will also provide them with the opportunity to use an order tracing system.