Mr. Liam O'Brien:

I thank the committee for the opportunity to engage with it in this important legislative process. I am joined by my colleague, Mr. Andrew Walsh. I hope the committee will bear with me if I repeat or reiterate any of the points that have already been raised by my colleagues from the industry.

I will start by providing the members with a brief overview of Vodafone in Ireland as a total communications provider and more specifically our role as the newest entrant to the Irish TV market. Vodafone provides communications services to 2.3 million customers across the country and employs over 2,000 people directly and indirectly in Ireland. Since entering the market 15 years ago, Vodafone has been the single biggest investor in new technology in the Irish telecoms industry, with over €2 billion invested to date. Over the coming years, we have committed to investing €500 million in Ireland across mobile, broadband, fibre to the home, network infrastructure and enhanced customer care systems. More specifically, turning to the broadcasting sector and the reason we are with the committee today, Vodafone TV launched in the Irish market in January 2016. We have invested heavily to deliver an end to end IPTV infrastructure and compelling TV solution that caters for the ways in which Irish consumers want to access content today. Vodafone is growing fast in what is a very competitive TV marketplace, but our share currently only represents a fraction - less than 2% - of the wider pay market in Ireland.

For all the reasons already outlined today, Vodafone believes public service broadcasting in Ireland via RTE and TG4 plays a hugely important role in society. Public service broadcasting encourages standards, more indigenous programming and, importantly, local content production. Public service broadcasting brings us together and continues to have an important role across Irish society and daily life. We do not wish to lose sight of this. Under the obligations set out in the Broadcasting Act we provide users with access to RTE on Vodafone TV. At our discretion and as part of our integrated strategy, we have provided RTE with top positioning within our electronic programming guides which as outlined already has a positive impact on RTE's ability to drive high viewing figures and significant advertising revenues across all pay TV platforms in Ireland. Availability and ease of access is central in delivering RTE's own public service obligations. Without repeating what has been said verbatim, we broadly support and echo the arguments put forward by the independent experts, CIL Management and Communications Chambers and the operators present here today.

A central component of this discussion and any policy options under consideration is to ensure an understanding of the evolving nature of the viewing habits of consumers here in Ireland. Specifically, pay TV is not just about linear feeds or free-to-air TV services such as RTE, TG4 and TV3. It is about delivering innovative solutions that allow users to pause and rewind live TV and to record and access content at their own convenience when and where it suits them. Platforms and technology have continually evolved to provide access to what users are looking for in entertainment services, content and product features on multiple devices such as multi-room set top boxes and mobile and tablet access in and out of the home. In order to address this evolving demand, Vodafone was the first in the market to offer Netflix as part of an integrated package. It was a bold move. Many in the industry might argue it is a Trojan horse for broadcasting but we cannot ignore how consumers wish to use and access media today and the product features they demand. Central to our launch strategy last year was to ensure we provided new innovative features such as on-demand, catch-up and restart TV across multiple channels. In the current TV market in Ireland, Vodafone now offers on-demand content across more than 50 channels. This is not to say that linear TV feeds do not continue to play an important role and fulfil an important requirement and offering but considerable time is now spent by consumers accessing content on demand at a time that suits them, whether it is on-demand via Netflix or through the catch-up services offered on our platform. These features and additional services outside of traditional linear TV are required to entice customers actually to pay for TV services. We do not believe the importance of these features and additional services have been properly considered. They are central in our ability at Vodafone and also amongst the other operators here today to recruit paying TV customers.

We would also like to highlight that we view RTE as an important partner. There are many touch points between our organisations. As a result of a commercial agreement with RTE, Vodafone offers RTE on-demand TV across our services platform. Some previous public commentary has implied that existing operators do not pay anything to RTE, which is not the case. This partnership, in addition to the advertising by Vodafone across RTE’s platforms, sees Vodafone making a significant financial contribution that supports RTE’s ongoing operations.

As the proponents of retransmission fees, RTE is seeking the amendment of section 77 of the 2009 Act to allow broadcasters the right to negotiate commercial terms. The amendment in its current form has been presented by RTE as a straightforward change that would simply provide for an entitlement for RTE to be paid. It is our clear position that the introduction of these potential retransmission fees would be fundamentally at odds with the current legislative and operational framework that supports and underpins public service broadcasting in Ireland. This proposal does not consider the complexities involved in governing a negotiation process for public service broadcasting. More specifically, for example there is no mention of how any fees if determined payable should be calculated, the dispute resolution mechanisms that would be required, the regulatory bodies required to mediate and the required determination of fees payable if the parties cannot agree.

Vodafone represents a fraction of the overall pay TV market at less than 2%. How would Vodafone be treated when compared to other established operators in this regard? The proposal to amend the legislation does not consider the complexities involved. Any proposed changes or amendments to the existing legislation involving the introduction of retransmission fees would in our opinion be highly complex and could not be done without undertaking a complete review of all broadcasting legislation including the current licence fee regime. Currently, legislation prohibits charges for must-carry and must-offer channels. These enshrined principles require that pay TV platforms carry RTE, TG4 and TV3. The current legislation makes sense in the context of zero transmission fees but does not if there are charges.

I hope the Committee has an appreciation of the position of Vodafone and of the impacts which would be felt following the introduction of any form of retransmission fees. As outlined, we have an existing commercial partnership with RTE and other public service broadcasters, as do many of the operators here today, which we look forward to building upon in the coming years. The current legislative framework is beneficial for both parties, the public service broadcasters and the TV platform providers, in allowing for further commercial arrangements to be developed. Any introduction of retransmission fees will reduce the benefits enjoyed by all parties, in particular the licence fee paying public.