Virgin Media 2010 Annual Report Download - page 25

to the suspension or revocation of a Company’s right to provide electronic communications networks and
services. Ofcom also undertakes periodic reviews of the various economic markets within the
telecommunications sector to establish whether any provider has SMP warranting the imposition of remedies.
Fixed Line Telephony Services
As a fixed network operator we, like all other fixed network operators, including the incumbent, BT, are
deemed to have SMP in wholesale call termination on our own network, and are therefore subject to SMP
conditions in this market. However, these conditions do not have a significant impact on our ability to compete in
the wholesale market.
Broadband Services
Ofcom has recently concluded reviews of the Wholesale Local Access, or WLA, market (physical or passive
network access via methods such as LLU and duct access) and Wholesale Broadband Access, or WBA, market
(virtual or active network access via methods such as provision of wholesale managed service products). Ofcom
concluded that we do not have SMP in these markets, and as such there is no case for regulation as a result of
these reviews.
BT continues to have SMP in the WLA market and certain sub-national areas of the WBA market and must
therefore provide certain products and services on regulated terms (now including access to its ducts and poles).
Mobile Telephony Services
As a MVNO, we are also subject to specific EU regulation relating to retail prices for roaming services. In
June 2007, European Commission Regulation 717/2007, or the Roaming Regulation, introduced limits on certain
wholesale and retail tariffs for international mobile voice roaming within the EU and required greater levels of
transparency of retail pricing information. As of July 2009, certain amendments to the Roaming Regulation took
effect, which expanded the scope to include SMS tariffs and data roaming, further reduced the maximum
roaming rates within the EU and required operators to introduce, by March 2010, measures aimed at preventing
consumer bill shock relating to data roaming charges. The Roaming Regulation, which will expire in 2012, is
subject to review in 2011 and the European Commission has commenced this review with a consultation.
Mobile termination charges of MNOs are regulated by Ofcom under SMP conditions imposed in respect of
the mobile call termination market. One of these SMP conditions requires the MNOs to comply with a price
control which requires them to reduce their mobile termination charges over time. Under our MVNO agreement
with Everything Everywhere, these changes in mobile termination charges are passed on to Virgin Mobile.
Ofcom is currently consulting on the charges for mobile termination which will apply in the period between
April 2011 and 2015.
Corporate Responsibility and Sustainability
We continue to seek to embed the principle of corporate responsibility in the way we grow our business. For
us, that that means managing our impact on society and ensuring that what we leave behind for future generations
is sustainable, for people and our planet.
In 2010, we put digital entertainment at the heart of our sustainability strategy. Our key focus has been to
use our digital technology to provide people with social benefits, for example, via our Virgin Media Pioneers
Programme.
We have also prioritised three other objectives: becoming a low carbon, low waste business; creating a
diverse and inclusive workplace; and working with our suppliers to meet our sustainability challenges. Targets
for improved performance have been set across each of these objectives.
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