U.S./ITALY BILATERAL TALKS ON COMMUNICATIONS POLICY: FROM BROADBAND TO WI-FI TO CYBER SECURITY

UNCLAS SECTION 01 OF 04 ROME 001084

SIPDIS

SENSITIVE

COMMERCE FOR NTIA/GALLAGHER/SPECK; USDOC FOR
4220/MAC/EUR/SED/DDEFALCO; FCC FOR AGOMEZ AND ATHOMAS;
JUSTICE FOR CWILLNER

UNCLASSIFIED

PAGE 02 ROME 01084 01 OF 04 171344Z
E.O. 12958: N/A
TAGS: ECPS ETRD ETRD ETRD ETRD IT ITECPS ITECPS ITECPS
SUBJECT: U.S./ITALY BILATERAL TALKS ON COMMUNICATIONS
POLICY: FROM BROADBAND TO WI-FI TO CYBER SECURITY

REF: A. 03 ROME 250


B. 03 ROME 392

C. 02 ROME 3437

D. 02 ROME 2533

SENSITIVE BUT UNCLASSIFIED. NOT FOR INTERNET DISTRIBUTION.


1. (SBU) SUMMARY. DURING RECENT BILATERAL MEETINGS ON
COMMUNICATIONS POLICY, THE GOI UNDERSCORED ITS EAGERNESS TO
WORK WITH THE USG ON ISSUES LEADING UP TO THE WORLD
RADIOCOMMUNICATION CONFERENCE IN JUNE AND THE WORLD SUMMIT ON
THE INFORMATION SOCIETY IN DECEMBER, WHEN ITALY, AS EU
PRESIDENT, WILL SPEAK FOR THE EU. AT THE MARCH 6-7TH TALKS,
U.S. AND ITALIAN OFFICIALS ALSO DISCUSSED TELECOM REGULATORY
REFORMS, TECHNOLOGICAL ADVANCES AND INCENTIVES TO PROMOTE
THEIR USE, MARKET COMPETITION, AND CYBERSECURITY. REGARDING
THE LATTER, ITALIAN OFFICIALS INDICATED THEY INTEND TO PLAY A
KEY ROLE IN SHAPING THE JUST-ANNOUNCED EU CYBER SECURITY
AGENCY. U.S. AND ITALIAN COMPANY EXECUTIVES SHARED WITH THE
U.S. DELEGATION THEIR VIEWS ABOUT THE ITALIAN AND U.S.
TELECOM MARKETS. END SUMMARY.


2. (U) AMBASSADOR DAVID A. GROSS, U.S. COORDINATOR FOR
INTERNATIONAL COMMUNICATIONS POLICY, STATE DEPARTMENT, LED AN
INTER-AGENCY TEAM, WHICH INCLUDED DAS MICHAEL GALLAGHER OF
THE NATIONAL TELECOMMUNICATIONS AND INFORMATION
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ADMINISTRATION (NTIA) OF THE COMMERCE DEPARTMENT; FEDERAL
COMMUNICATIONS COMMISSION'S INTERNATIONAL BUREAU DEPUTY CHIEF
ANNA GOMEZ; SENIOR ATTORNEY CARL WILLNER OF THE JUSTICE
DEPARTMENT'S ANTI-TRUST DIVISION, ALONG WITH STATE, COMMERCE,
AND FCC STAFF FOR THE DAY AND ONE-HALF BILATERAL DISCUSSIONS
WITH THE ITALIAN GOVERNMENT. MINISTER OF COMMUNICATIONS
MAURIZIO GASPARRI AND U.S. AMBASSADOR MEL SEMBLER INAUGURATED
THE DISCUSSIONS. SECRETARY GENERAL VITTORIO STELO OF THE
MINISTRY OF COMMUNICATIONS LED THE ITALIAN DELEGATION, WHICH
INCLUDED THE FIVE DIRECTOR GENERALS OF THE MINISTRY AND
OFFICIALS FROM THE COMMUNICATIONS AUTHORITY (ITALY'S
REGULATORY AGENCY). AGENDA TOPICS INCLUDED: REGULATORY
REFORM; INTERNATIONAL ISSUES - POST-MARRAKECH AND THE WORLD
RADIOCOMMUNICATION CONFERENCE; TECHNOLOGICAL DEVELOPMENTS,
INCLUDING DIGITAL TV AND WI-FI; MERGERS AND ACQUISITIONS, AND
CYBERSECURITY.

RATIONALE FOR DISCUSSIONS


3. (U) TIMING FOR DISCUSSIONS WITH ITALY ON COMMUNICATIONS
POLICY WAS PROPITIOUS. ITALY'S EU PRESIDENCY WILL OCCUR AT
THE SAME TIME WHEN MEMBER STATES ARE REQUIRED TO IMPLEMENT
THE 2002 EU COMMUNICATIONS LEGISLATIVE PACKAGE WILL OCCUR.
AS EU PRESIDENT, ITALY SHOULD SET THE EXAMPLE FOR AND ALSO
COULD INFLUENCE MEMBER STATE IMPLEMENTATION. ITALY WILL HOLD
THE EU'S LEADERSHIP POSITION DURING THE WORLD SUMMIT ON THE
INFORMATION SOCIETY TAKING PLACE IN GENEVA IN DECEMBER 2003.

REFORM/EU DIRECTIVES ON TELECOMMUNICATIONS


4. (U) MINISTRY AND AUTHORITY OFFICIALS GAVE AN OVERVIEW OF
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PAGE 04 ROME 01084 01 OF 04 171344Z
REFORM IN THE TELECOMMUNICATIONS MARKET AND THE STATUS OF
IMPLEMENTATION OF THE EU DIRECTIVE ON TELECOMMUNICATIONS.
WITHIN THE PAST FOUR YEARS, THEY NOTED, THE INCUMBENT
CARRIER, TELECOM ITALIA, HAS BEEN FULLY PRIVATIZED; ALL
EXCLUSIVE RIGHTS HAVE BEEN ABOLISHED. AS OF JANUARY 2003,
THERE WERE 225 LICENSED OPERATORS IN FIXED VOCAL TELEPHONY
AND NETWORKS, OF WHICH NINE ARE LICENSED MOBILE OPERATORS.


5. (U) THE LOCAL LOOP HAS BEEN UNBUNDLED. PROGRESS, HOWEVER,
HAS BEEN SLOW, ACKNOWLEDGED MINISTRY OFFICIALS. SINCE
UNBUNDLING WAS OFFICIALLY ANNOUNCED IN SPRING 2002, HOWEVER,
MORE THAN 150,000 SUBSCRIBERS HAVE SWITCHED CARRIERS. NUMBER
PORTABILITY IS UNDERWAY. USERS WILL BE ABLE TO HAVE THE SAME
PHONE NUMBER EVEN WHEN THEY SWITCH FROM GSM TO THIRD
GENERATION WIRELESS (3G) SERVICES.


6. (U) THE GOI INTENDS TO INTRODUCE IN PARLIAMENT BY JULY 7,
2003, THE LEGISLATIVE PACKAGE REQUIRED FOR APPROVAL AND
IMPLEMENTATION OF THE FIVE EU DIRECTIVES RELATED TO
TELECOMMUNICATIONS - FRAMEWORK, INTERCONNECTION,
AUTHORIZATION, UNIVERSAL SERVICE, AND RADIO SPECTRUM
DIRECTIVES. BY OCTOBER 31ST, THE GOI INTENDS TO SUBMIT TO
PARLIAMENT LEGISLATION RELATED TO EU DIRECTIVE 2002/58 ON
PRIVACY AND DATA RETENTION. GOI OFFICIALS DO NOT EXPECT

UNCLASSIFIED

UNCLASSIFIED PTQ2198

PAGE 01 ROME 01084 02 OF 04 171344Z
ACTION EUR-00

INFO LOG-00 AID-00 CEA-01 CIAE-00 CIP-00 CTME-00 INL-00
DODE-00 ITCE-00 SRPP-00 EB-00 EXME-00 E-00 UTED-00
VC-00 FRB-00 H-01 TEDE-00 INR-00 IO-00 ITC-01
LAB-01 L-00 VCE-00 AC-01 NSAE-00 NSCE-00 OES-00
OMB-01 OPIC-01 CAEX-01 PER-00 ACE-00 SP-00 IRM-00
SSO-00 SS-00 STR-00 TEST-00 TRSE-00 USIE-00 R-00
DRL-01 G-00 SAS-00 /009W
-------------- 458FC7 171344Z /38
R 171239Z MAR 03
FM AMEMBASSY ROME
TO SECSTATE WASHDC 8753
INFO EU MEMBER STATES COLLECTIVE
AMCONSUL FLORENCE
AMCONSUL MILAN
AMCONSUL NAPLES
DEPT OF COMMERCE WASHDC
DEPT OF JUSTICE WASHDC
FCC WASHDC

UNCLAS SECTION 02 OF 04 ROME 001084

SIPDIS

SENSITIVE

COMMERCE FOR NTIA/GALLAGHER/SPECK; USDOC FOR
4220/MAC/EUR/SED/DDEFALCO; FCC FOR AGOMEZ AND ATHOMAS;
JUSTICE FOR CWILLNER

UNCLASSIFIED

PAGE 02 ROME 01084 02 OF 04 171344Z
E.O. 12958: N/A
TAGS: ECPS ETRD ETRD ETRD ETRD IT ITECPS ITECPS ITECPS
SUBJECT: U.S./ITALY BILATERAL TALKS ON COMMUNICATIONS
POLICY: FROM BROADBAND TO WI-FI TO CYBER SECURITY

PARLIAMENT TO DELAY IN ACTING ON AND APPROVING LEGISLATION
THAT IMPLEMENTS THESE DIRECTIVES. THE DIPLOMATIC ADVISOR TO
MINISTER OF COMMUNICATIONS, GIANFRANCO GIORGOLO, UNDERSCORED
THAT THE LEGISLATIVE PACKAGE WILL ESTABLISH A CLEAR
REGULATORY FRAMEWORK IN ITALY FOR TELECOMMUNICATIONS.


7. (SBU) MINISTRY OFFICIALS HIGHLIGHTED AREAS IN WHICH EX
ANTE REGULATION MAY BE WARRANTED. THEY INCLUDE CALL
ORIGINATION AND CALL TERMINATION; TRANSIT SERVICE; WHOLESALE
TRUNK LEASED LINES AND UNBUNDLED ACCESS; BROADCASTING
SERVICES AND WHOLESALE BROADBAND SERVICES.

THE MARKET - EUROPE AND ITALY


8. (SBU) COMMUNICATIONS AUTHORITY OFFICIALS SHARED WITH THE
U.S. DELEGATION INFORMATION FROM A SOON-TO-BE RELEASED
COMMISSION REPORT ON THE COMMUNICATIONS MARKET. ACCORDING TO
THIS REPORT, EU COUNTRIES ACCOUNT FOR 25 PERCENT OF THE WORLD
MARKET FOR TELECOMMUNICATIONS. IN 2003, GIVEN THE RECESSION
IN THE EURO-ZONE, THE SHARE IS EXPECTED TO CONTRACT BY ONE
PERCENT, WITH ASIA'S SHARE INCREASING PROPORTIONALLY. MOBILE
SERVICES, NOT INCLUDING HARDWARE, ACCOUNT FOR 37 PERCENT OF
ALL TELECOM SERVICES IN EUROPE. SUBSCRIBERS FOR MOBILE
SERVICES IN THE EU REACHED 213 MILLION IN 2002. PRE-PAID
CARDS ACCOUNT FOR A SIZABLE MARKET SHARE. IN ITALY, 78
PERCENT OF USERS OF MOBILE SERVICES USE PRE-PAID CARDS. TEXT
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PAGE 03 ROME 01084 02 OF 04 171344Z
MESSAGING AND INTERNET ON CELL PHONES ACCOUNT FOR AN
ESTIMATED 10 PERCENT OF REVENUES FOR MOBILE OPERATORS IN
EUROPE. THE INTERNET HAS SPURRED GROWTH IN THE FIXED LINE
MARKET AS WELL. FIXED LINE TELEPHONY GREW 10 PERCENT FROM
2001 TO 2002 IN EUROPE; EUROPE NOW HAS MORE THAN 329 MILLION
FIXED LINES.


9. (U) IN EUROPE, AND PARTICULARLY IN ITALY, THE MARKET FOR
MOBILE IS NEARLY SATURATED. COMPETITION WILL BE FOCUSED ON
PRICE, COMMENTED AUTHORITY OFFICIALS.

3G/BROADBAND/WI-FI


10. (U) FIVE 3G LICENSES HAVE BEEN ISSUED, ONE EACH TO H3G
ITALIA, IPSE 2000, TELECOM ITALIA MOBILE (TIM),
OMNITEL-VODAFONE, WIND. THE LICENSES ARE FOR 20 YEARS, WITH
COVERAGE OBLIGATIONS OF PROVISIONS TO REGIONS BY 2004 AND TO
PROVINCIAL CAPITALS BY 2006. ACCORDING TO THE MINISTRY, TWO
OPERATORS, TIM AND H3G, ARE NEARLY READY TO BEGIN OPERATIONS.
H3G IS EXPECTED TO START LIMITED SERVICE IN THE SUMMER. THE
GOI IS EXPLORING DIFFERENT INCENTIVES TO ENCOURAGE 3G
DEVELOPMENT. ONE BARRIER TO START UP IS THE DIFFERENT
REGIONAL STANDARDS FOR ELECTRONIC MAGNETIC TRANSMISSION
EMISSIONS (EMTS). THE GOI IS WORKING WITH REGIONAL
AUTHORITIES TO SET A NATIONAL STANDARD FOR EMISSIONS, AND
WILL UNDERTAKE A PUBLIC EDUCATION CAMPAIGN TO ASSUAGE THE
PUBLIC'S CONCERNS ABOUT EMTS.


11. (U) THE DEVELOPMENT AND EXPANSION OF BROADBAND IS A KEY
GOAL FOR THE MINISTRY, AND FOR THE ITALIAN GOVERNMENT AS A
WHOLE. MINISTRY OFFICIALS INDICATED THAT BROADBAND
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PAGE 04 ROME 01084 02 OF 04 171344Z
DEVELOPMENT WILL BE ONE OF THE ITALY'S PRIORITIES AS EU
PRESIDENT.


12. (SBU) THE GOVERNMENT IS FINE-TUNING A PLAN FOR BROADBAND
DEVELOPMENT, WHICH INCLUDES PUBLIC FUNDING OF NEARLY ONE
BILLION EUROS OVER FIVE YEARS FOR PUBLIC DEMAND/USE. THE
MINISTRY FOR INNOVATION AND TECHNOLOGY HAS CREATED AN
EXECUTIVE COMMITTEE FOR BROADBAND DEVELOPMENT. THE EVENTUAL
AIM OF THE GOVERNMENT'S EFFORTS IS TO HAVE BROADBAND COVERAGE
FOR 85-90 PERCENT OF PUBLIC ADMINISTRATION, 65 PERCENT OF
BUSINESSES AND 35 PERCENT OF HOUSEHOLDS. COMMUNICATIONS
MINISTRY OFFICIALS ARGUED THAT BROADBAND'S POTENTIAL IN ITALY
IS GREATER THAN IN THE REST OF EUROPE. GIVEN ITALY'S VARIED
TOPOGRAPHY AND ITS ANCIENT RUINS, THE LAYING OF CABLE LINES
PROVED DIFFICULT. CABLE TRANSMISSION NEVER TOOK OFF.


13. (U) WI-FI HAS JUST BEGUN IN ITALY, ACKNOWLEDGED MINISTRY
OFFICIALS. ITALY'S NATIONAL PLAN FOR FREQUENCIES ENVISIONS
THREE BANDS FOR WI-FI. A DECREE ISSUED IN FEBRUARY OPENS
ACCESS TO WI-FI, BOTH FOR PUBLIC AND PRIVATE USE. ALTHOUGH
NO OFFICIAL LICENSE IS REQUIRED, POTENTIAL WI-FI OPERATORS
MUST INFORM THE MINISTRY PRIOR TO STARTING UP OPERATIONS.

TERMINATION COSTS

UNCLASSIFIED

UNCLASSIFIED PTQ2204

PAGE 01 ROME 01084 03 OF 04 171345Z
ACTION EUR-00

INFO LOG-00 AID-00 CEA-01 CIAE-00 CIP-00 CTME-00 INL-00
DODE-00 ITCE-00 SRPP-00 EB-00 EXME-00 E-00 UTED-00
VC-00 FRB-00 H-01 TEDE-00 INR-00 IO-00 ITC-01
LAB-01 L-00 VCE-00 AC-01 NSAE-00 NSCE-00 OES-00
OMB-01 OPIC-01 CAEX-01 PER-00 ACE-00 SP-00 IRM-00
SSO-00 SS-00 STR-00 TEST-00 TRSE-00 USIE-00 R-00
DRL-01 G-00 SAS-00 /009W
-------------- 458FF5 171345Z /38
R 171239Z MAR 03
FM AMEMBASSY ROME
TO SECSTATE WASHDC 8754
INFO EU MEMBER STATES COLLECTIVE
AMCONSUL FLORENCE
AMCONSUL MILAN
AMCONSUL NAPLES
DEPT OF COMMERCE WASHDC
DEPT OF JUSTICE WASHDC
FCC WASHDC

UNCLAS SECTION 03 OF 04 ROME 001084

SIPDIS

SENSITIVE

COMMERCE FOR NTIA/GALLAGHER/SPECK; USDOC FOR
4220/MAC/EUR/SED/DDEFALCO; FCC FOR AGOMEZ AND ATHOMAS;
JUSTICE FOR CWILLNER

UNCLASSIFIED

PAGE 02 ROME 01084 03 OF 04 171345Z
E.O. 12958: N/A
TAGS: ECPS ETRD ETRD ETRD ETRD IT ITECPS ITECPS ITECPS
SUBJECT: U.S./ITALY BILATERAL TALKS ON COMMUNICATIONS
POLICY: FROM BROADBAND TO WI-FI TO CYBER SECURITY


14. (U) THE TERMINATION COST OF FIXED TO MOBILE NETWORKS IN
ITALY IS IN EXCESS OF COSTS. U.S. FIRMS HAVE COMPLAINED
ABOUT THESE COSTS, AND IN JANUARY 2003, COMPTEL FILED A
COMPLAINT IN THE OFFICE OF THE U.S. TRADE REPRESENTATIVE'S
(USTR'S) SECTION 1377 REVIEW. WHILE THE U.S. DELEGATION
PRAISED THE AUTHORITY'S RECENT DECISION TO SET NEW TARIFFS
FOR FIXED TO MOBILE INTERCONNECTION, AT 14.95 EURO CENTS FOR
TERMINATION, A REDUCTION BY 12 PERCENT, THE U.S. ALSO
EMPHASIZED THE NEED FOR FUTURE REDUCTIONS. REGULATORY
OFFICIALS TOLD THE U.S. DELEGATION THAT THEY PLAN TO REDUCE
TERMINATION COSTS FURTHER IN 2004 AND 2005, IN THE RANGE OF
20 PERCENT, AND WILL INTRODUCE A NEW BASKET OF FIVE SERVICES
SUBJECT TO A PRICE CAP.

MULTILATERAL ISSUES - ITU, WRC, WSIS


15. (SBU) THE TWO DELEGATIONS DISCUSSED AT LENGTH THEIR
CONCERNS ABOUT THE OUTCOME OF THE MARRAKECH MEETING OF THE
ITU PLENIPOTENTIARY WHICH TOOK PLACE IN OCTOBER 2002.
DIPLOMATIC ADVISOR GIORGOLO UNDERSCORED THE GOI'S FRUSTRATION
WITH THE MEETING AND CONCERN THAT ITALY'S POSITIONS WERE NOT
HEARD. IN PARTICULAR, ITALY IS CONCERNED THAT ITS REDUCTION
IN CONTRIBUTION BY FIVE UNITS WILL LEAD TO A COMMENSURATE
LOSS IN INFLUENCE.

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PAGE 03 ROME 01084 03 OF 04 171345Z

16. (SBU) THE U.S. IS CONCERNED ABOUT THE FOCUS OF THE ITU,
COMMENTED AMBASSADOR GROSS. THE U.S. WAS DISAPPOINTED WITH
THE "COMPROMISE" THAT FORCED COUNTRIES TO REDUCE THEIR
CONTRIBUTIONS BECAUSE OF THE INCREASED VALUE OF EACH SHARE.
THE U.S. WANTED THE VALUE OF EACH SHARE TO STAY THE SAME.
GROSS NOTED THE USG'S CONCERN ABOUT THE PREMATURE
ELECTIONEERING OF POTENTIAL CANDIDATES FOR ITU; ELECTIONS ARE
NOT FOR THREE AND A HALF YEARS.


17. (SBU) FABIO BIGI, SENIOR COUNSELOR FOR THE MINISTRY OF
COMMUNICATIONS, ARGUED THAT THE CENTRAL ROLE OF THE ITU AFTER
MARRAKECH SHOULD BE THE DEVELOPMENT OF WORLDWIDE
COMMUNICATIONS. THE GENERAL SECRETARIAT SHOULD SUPPORT
ACTIVITY OF THE RADIOCOMMUNICATION, STANDARDIZATION, AND
DEVELOPMENT SECTORS. THE COST OF RUNNING THE ITU, HE ARGUED,
SHOULD NOT BE INCREASED. THE SECRETARIAT SHOULD EVALUATE THE
ITU'S SERVICES AND PRODUCTS, ESTABLISH PRIORITIES, AND
IMPROVE MANAGEMENT AND ACCOUNTABILITY. THE ITU SHOULD
UNDERTAKE STEPS TO BRIDGE THE DIGITAL DIVIDE, HE URGED. IN
ADDITION, THE ITU SHOULD FAVOR THE UNIVERSAL ACCESS TO
TELECOMMUNICATIONS SERVICES AND PRODUCTS.


18. (SBU) MINISTRY OFFICIALS EXPRESSED THEIR HOPE THAT THE
ITU WILL CONDUCT STUDIES TO ENCOURAGE THE DEVELOPMENT OF 3G
SYSTEMS. THE ITU ALSO SHOULD WORK ON FREQUENCY BAND
ALLOCATIONS. IN PREVIOUS ITU CONFERENCES, THEY NOTED, SOME
FREQUENCY BANDS WERE IDENTIFIED AND ISSUED. SUCH ALLOCATIONS
ARE ESSENTIAL, THEY ARGUED, TO GIVE COMPATIBILITY TO 3G
SYSTEMS AND TO ENCOURAGE THE VIABILITY OF GALILEO.


19. (SBU) BIGI, GIORGOLO, AND OTHER ITALIAN DELEGATES
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PAGE 04 ROME 01084 03 OF 04 171345Z
UNDERSCORED THEIR EAGERNESS TO WORK WITH THE U.S. ON ITU AND
OTHER MULTILATERAL ISSUES. THEY NOTED THAT IT WAS OBVIOUS IN
MARRAKECH THAT THE U.S. AND ITALY SHARED ABOUT 90 PERCENT OF
THE SAME POSITIONS. THE TWO GOVERNMENTS COULD HAVE COMBINED
STRATEGIES AND TACTICS, BIGI COMMENTED. THE GOI EMPHASIZED
ITS DESIRE TO WORK WITH THE U.S. IN THE LEAD UP TO THE WRC IN
JUNE AND THE WORLD SUMMIT ON THE INFORMATION SOCIETY IN
DECEMBER. REGARDING THE WRC, ITALY'S POSITION ON WIRELESS
LOCAL AREA NETWORKS IS DIFFERENT FROM THE EU CONSENSUS,
GIORGOLO POINTED OUT.

LEGAL FRAMEWORK


20. (U) AT THE TIME OF THE BILATERALS, MINISTRY UNDER
SECRETARY INNOCENZI WAS TESTIFYING BEFORE PARLIAMENT ON THE

SIPDIS
LEGGE GASPARRI (THE LAW NAMED AFTER MINISTER OF
COMMUNICATIONS GASPARRI). THE BILL, INTRODUCED TO PARLIAMENT
IN SEPTEMBER 2002, FOCUSES PRIMARILY ON MEDIA OWNERSHIP.
ACCORDING TO MINISTRY OFFICIALS, THE BILL IS BASED ON AN
INTEGRATED ANTI-TRUST REGIME, WHICH TAKES INTO ACCOUNT
EVERYTHING FROM TELEVISION, INTERNET, TELECOMMUNICATIONS,
PUBLISHING. THE LEGGE GASPARRI ALSO SETS THE FRAMEWORK FOR
THE PRIVATIZATION OF THE PUBLIC TELEVISION OPERATOR AND
SERVICE PROVIDER, RAI. MORE THAN 2000 AMENDMENTS HAVE BEEN

UNCLASSIFIED

UNCLASSIFIED PTQ2210

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ACTION EUR-00

INFO LOG-00 AID-00 CEA-01 CIAE-00 CIP-00 CTME-00 INL-00
DODE-00 ITCE-00 SRPP-00 EB-00 EXME-00 E-00 UTED-00
VC-00 FRB-00 H-01 TEDE-00 INR-00 IO-00 ITC-01
LAB-01 L-00 VCE-00 AC-01 NSAE-00 NSCE-00 OES-00
OMB-01 OPIC-01 CAEX-01 PER-00 ACE-00 SP-00 IRM-00
SSO-00 SS-00 STR-00 TEST-00 TRSE-00 USIE-00 R-00
DRL-01 G-00 SAS-00 /009W
-------------- 45900F 171346Z /38
R 171239Z MAR 03
FM AMEMBASSY ROME
TO SECSTATE WASHDC 8755
INFO EU MEMBER STATES COLLECTIVE
AMCONSUL FLORENCE
AMCONSUL MILAN
AMCONSUL NAPLES
DEPT OF COMMERCE WASHDC
DEPT OF JUSTICE WASHDC
FCC WASHDC

UNCLAS SECTION 04 OF 04 ROME 001084

SIPDIS

SENSITIVE

COMMERCE FOR NTIA/GALLAGHER/SPECK; USDOC FOR
4220/MAC/EUR/SED/DDEFALCO; FCC FOR AGOMEZ AND ATHOMAS;
JUSTICE FOR CWILLNER

UNCLASSIFIED

PAGE 02 ROME 01084 04 OF 04 171346Z
E.O. 12958: N/A
TAGS: ECPS ETRD ETRD ETRD ETRD IT ITECPS ITECPS ITECPS
SUBJECT: U.S./ITALY BILATERAL TALKS ON COMMUNICATIONS
POLICY: FROM BROADBAND TO WI-FI TO CYBER SECURITY

ADDED ON TO THE LEGGI GASPARRI. TIMETABLE FOR PASSAGE IS
STILL NOT CERTAIN.


21. (U) THE ITALIAN PARLIAMENT HAS MANDATED THE END OF ANALOG
TV TRANSMISSION AND ADOPTION OF DIGITAL BY 2006. THE MINISTER
AND AUTHORITY ARE WORKING ON A NATIONAL FREQUENCY PLAN,
ALTHOUGH EACH REGION WILL HAVE ITS OWN FREQUENCY NETWORK.
THE AUTHORITY WILL ISSUE LICENSES FOR DIGITAL TV. NO SINGLE
PROVIDER WILL BE ABLE TO USE MORE THAN 20 PERCENT OF THE
NATIONAL DIGITAL SPECTRUM.

CYBER SECURITY


22. (U) THROUGHOUT THE TWO DAYS OF DISCUSSIONS, THE
PROTECTION OF CRITICAL TELECOM AND IT NETWORKS WAS A COMMON
THEME. FOLLOWING LAST MAY'S CONFERENCE ON CYBER-SECURITY,
CO-SPONSORED BY THE EMBASSY AND THE OFFICE OF THE PRIME
MINISTER, THE MINISTRIES OF COMMUNICATION AND OF INNOVATION
AND TECHNOLOGY JOINTLY FORMED AN ADVISORY COMMITTEE ON
CYBER-SECURITY. SECRETARY GENERAL OF THE MINISTRY OF
COMMUNICATIONS VITTORIO STELO HEADS THIS COMMITTEE.


23. (SBU) PROCLAIMING THAT "WE CAN NOT BE FREE, IF NOT SAFE,"
STELO UNDERSCORED THE NEED FOR NETWORK SYSTEMS THAT ARE FAST,
MODERN, EFFICIENT AND SECURE. THE ADVISORY COMMITTEE, WHICH
HE HEADS, IS EXPLORING THE DEVELOPMENT OF A COMPUTER EARLY
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PAGE 03 ROME 01084 04 OF 04 171346Z
RESPONSE TEAM (CERT) IN ITALY, PROMOTING THE AWARENESS OF THE
NEED TO PROTECT SYSTEMS, WORKING WITH THE PRIVATE SECTOR.
THE COMMITTEE WILL EVENTUALLY DESIGN A NATIONAL STRATEGY FOR
THE PROTECTION OF NETWORKS USED BY THE PUBLIC ADMINISTRATION.


24. (SBU) GOI OFFICIALS DISCUSSED IN BRIEF THE JUST-CREATED
EU CYBER SECURITY AGENCY. SINCE THE MANDATE AND STRUCTURE OF
THIS AGENCY IS STILL ON THE DRAWING BOARDS, THE GOI WANTS TO
PLAY A SIGNIFICANT ROLE IN SHAPING THIS AGENCY. ACCORDING TO
COMMITTEE MEMBERS, FUNDING OF 24 MILLION EUROS HAS BEEN
PROVIDED FOR THE FIRST YEAR FOR THIS AGENCY. UPON THE
ENLARGEMENT OF THE EU, ANNUAL FUNDING WILL INCREASE BY AT
LEAST NINE MILLION EUROS. THE GOI ALSO INTENDS TO MAKE
CRITICAL INFRASTRUCTURE PROTECTION (CIP) A TOP PRIORITY AS EU
PRESIDENT, ACCORDING TO MINISTRY OFFICIALS. ITALIAN
OFFICIALS ARE EAGER TO CONTINUE WORKING WITH THE U.S. ON CIP,
AND ARE PARTICULARLY INTERESTED IN EXPLORING JOINT R&D
PROJECTS AND COMBINING EFFORTS ON CERTIFICATION OF SOFTWARE
AND SYSTEMS.

PRIVATE SECTOR


25. (U) ON THE MARGINS OF THE OFFICIAL DISCUSSIONS, THE U.S.
DELEGATION MET SEPARATELY WITH REPRESENTATIVES OF MAJOR U.S.
TELECOM COMPANIES (VERIZON, AT&T, MOTOROLA) AND ITALIAN
(TELECOM ITALIA, EUTELSAT, RAI, WIND, TELEPIU AND OTHERS).
THE ISSUE OF TERMINATION COSTS DOMINATED THE SESSION WITH THE
U.S. PRIVATE SECTOR. ON ONE HAND, AT&T AND OTHERS COMPLAINED
ABOUT THE HIGH COSTS, WHILE VERIZON, WHICH IS THE MINORITY
SHAREHOLDER IN OMNITEL-VODAFONE, MAINTAINED THAT SUCH COSTS
WERE JUSTIFIED. VERIZON AND OMNITEL EXECUTIVES ARGUED THAT
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PAGE 04 ROME 01084 04 OF 04 171346Z
TELECOM COMPANIES ARE TOO HEAVILY REGULATED IN ITALY. ITALIAN
COMPANIES INQUIRED ABOUT DIGITAL TELEVISION AND BROADBAND
DEVELOPMENT IN THE UNITED STATES, AND EXPRESSED OPTIMISM
ABOUT THE DEVELOPMENT AND EXPANSION OF BOTH IN ITALY.

COMMENT


26. (SBU) WE FOUND THE GOI EAGER AND WILLING TO DISCUSS AND
WORK WITH US ON REGULATORY ISSUES COMMON TO BOTH, TO EXCHANGE
IDEAS FOR ENCOURAGING THE DEVELOPMENT AND USE OF NEW
TECHNOLOGIES, AND TO COLLOBORATE PRIOR TO KEY MULTILATERAL
MEETINGS ON COMMUNICATIONS POLICY. IN SPECIFIC AREAS SUCH AS
THE PREPARATIONS FOR THE WORLD RADIOCOMMUNICATION CONGRESS
AND THE WORLD SUMMIT ON INFORMATION SOCIETY AND IN
CYBER-SECURITY, PARTNERSHIP WITH ITALY WILL BE INVALUABLE.
END COMMENT.


27. EB/CIP HAS CLEARED THIS CABLE.

SEMBLER

UNCLASSIFIED

>
2003ROME01084 - Classification: UNCLASSIFIED