Site: European Commission
Directorate XIII:
Telecommunications-Information
Directorate XII: Space
Rue de la Loi 200
B-1040 Brussels, Belgium

Date Visited: June 24, 1992

Report Author: J. Pelton

ATTENDEES

NASA/NSF:

J. Pelton

HOSTS:

Directorate XIII
Communications and Information (Rue de Treves 61 B-1040 Brussels)

Peter Johnston

Dr. Ing. Robert Pestel

Bartholome Arroyo-Fernandez

Andrew C. Page

Directorate XII-Space (Rue de Beaulieu)

Tim Howell

Paul Verhoef

BACKGROUND

The EC maintains an active R&D program in telecommunications, computers and information. A rather constant 40% of expenditures is devoted to these areas. The remaining 60% goes to energy, environment, manufacturing techniques, materials research and miscellaneous techniques. This high emphasis is given because these areas are seen as critical to European competitiveness. Unlike the U.S., the area of communications and information is viewed as more important than energy and environment.

Over a five year period, about 5.7 billion ECU is planned for European R&D in communications and information, estimated to be equal to four percent of all European R&D expenditures. Of this very large amount, however, only one percent or so is devoted to satellite communications. This emphasis on terrestrial communications systems seems likely to continue even though DG XII feels more satellite effort would be appropriate. DG XIII, however, tends to favor heavy emphasis on terrestrial communications.

EC R&D in 1990-1994 is projected to total 5.7 billion ECU. Industry must invest the same amount as EC. This is "pre-competitive" research. The breakdown is given in Table EC.1.

Table EC.1
"Pre-Competitive" Research Breakdown
(Billion ECU)

The EC has recognized that many of its research programs might be considered overly oriented toward "top-down" programs. They have now created industry advisory groups to define new projects and bid work out competitively. They also have moved from high-tech, long range, mega projects to more mass market and shorter term market projects in both communications and information services.

The EEC-based EUREKA project which is clearly "grass roots," industry defined, and very much more near-term market is thus seen with respect, and maybe with some small degree of rivalry. The purposes of EUREKA, RACE and ESPRIT are clearly different. EUREKA is very near term and not driven by the governments of European industrial policies. At the present time, EUREKA does not have any active satellite projects, but those could be created at any time. EUREKA is managed at the national level. Commercialization is not a part of EC R&D.

The EC sees its goals as two-fold:

1. to enhance European competitiveness
2. to increase European economic and social cohesion

Current EC activities being carried out to achieve these two goals with regard to telecommunications are the following:

1. Active pursuit of the RACE, ESPIRIT, Drive (communications in transportation) programs, as well as a new tele-education program called Delta.
2. Attempts to enhance European competitiveness as a stimulus to more cost effective telecommunications. (These tend to create some competitive frictions between northern Europe, which is actively pursuing highly competitive policies in telecommunications, versus southern Europe which is much less competitive.)
3. Attempts to create a more competitive and technically competent aerospace and telecommunications industry, as well as attempts to encourage ESA experimental programs in satellite communications to be more market responsive, better conceived in terms of timing and generally more relevant. The EC cited the potential dropping of the OBP from the ARTEMIS payload and the possible dropping of the MINISAT project as examples of this problem of ineffective liaison with industry.

Finally, by way of background, there is a clear asymmetry between the 12 countries of the EC, the 33 countries of the CEPT, and the 13 members of ESA which are significantly different from the EC membership. The EC has clear plans to add the European Free Trade Association, bringing in the Scandinavian countries, Austria and Switzerland, and raising EC membership to 17, and then after this, add East European members as well. Should this happen, it seems likely that the EC would exert ever increasing control of ESA and the CEPT. There is indeed evidence that this is already happening, particularly with the CEPT.

RESEARCH AND DEVELOPMENT ACTIVITIES

The EC carries out extensive R&D programs, described below in summary. The most relevant R&D program is called Research and Development in Advanced Communications Technologies in Europe (RACE). For a detailed description of RACE projects for "Framework Number 3," the 1991-1994 segment currently in progress, see the RACE 1992 Report listed in the bibliography. Of the nearly 90 projects in "Framework 3," and in the five year plan, only five projects are satellite- oriented, three being exclusively satellite-oriented and two both satellite- and terrestrial-oriented. These projects are shown in Table EC.2.

Table EC.2
Satellite-Oriented Projects in RACE's "Framework 3"

EC R&D projects in the satellite field are oriented toward DBS, compressed digital satellite video, mobile communications and VSATs. There is no focus on FSS and the general assumption is that fiber optical cable will become predominant in broadband systems and for most international services. It is thus not surprising that only about 5% of their projects involve satellites.

In addition to technical research, policy and regulatory research is also carried out. The key elements here are:

1. A consultant study that recommends the privatization of EUTELSAT
2. An initiative sponsored by both DG IV (Competition) and DG XII (Space) that extends competition and deregulation to all private VSAT services. DG XII noted that VSAT-based revenues of EUTELSAT doubled from 7% to 15% of total income after the service was opened to competition.

SUMMARY

A summary of European based R&D activities is provided in the RACE 1992 Report listed in the bibliography. Although this summary was prepared by ESA, officials of DG XII and XIII verified that it is a complete and accurate compilation.