Interview with Jean-Bernard LÉVY

COMMUNICATIONS & STRATEGIES No. 84, 4th Quarter 2011
Net Neutrality : Act II

Summary : What are the minimum regulatory tools needed to ensure an acceptable level of net neutrality while giving network operators flexibility to innovate and manage their networks? Act I of the debate resembled a war of religion, each side rejecting out of hand the other's philosophy. In Act II, market actors have understood that neutrality is not a binary topic and that the subject must be addressed in a collective and collaborative way for the sake of achieving economic and social efficiency. The debate has progressively shifted and focused on several key issues that are essential to the design of a well-functioning neutrality: (i) traffic management, (ii) IP interconnection arrangements, (iii) transparency, (iv) price differentiation and markets for enhanced quality, and (v) the setting up a suitable regulatory framework. Such are the main stakes of "Net Neutrality: Act II" and the focus of this special issue of COMMUNICATIONS & STRATEGIES.

Exclusive:

Interview with Jean-Bernard LÉVY
CEO, Vivendi
Conducted by Yves Gassot (Idate)

C&S: Does the fact that your company is involved in the telecoms sector (SFR, Maroc Telecom, GVT) as well as the TV (Canal Plus), movies (Studiocanal), music (Universal Music) and gaming industries (Activision Blizzard) give you a unique perspective and position on the Net neutrality debate?
Jean-Bernard LÉVY:  Vivendi is involved in numerous parts of the digital value chain: we create and publish content, we run service platforms that we make available to our customers and we deploy and operate infrastructure networks.
Every year, Vivendi invests over €5 billion (distributed equally) in content creation and acquisition, in platforms and network technologies.
Vivendi has a balanced approach to the net neutrality debate as we advocate both for the most diversified and innovative legal content offers and a robust and reliable network to provide a strong basis for content creation and interactive services.

C&S:  You were personally involved, along with the CEOs of Alcatel-Lucent and Deutsche Telekom, in organising widespread discussions between ICT sector players, and in presenting recommendations for improving Europe's role in digital industries to Neelie Kroes in July. What part did the Net neutrality issue play in these discussions and the resulting recommendations?
J.-B. L.:  Vice-President Neelie Kroes took the initiative to ask Ben Verwaayen, René Obermann and myself whether we would accept a mission on behalf of the Industry to come forward with concrete proposals on how to address broadband investment.
As you know, the Digital Agenda for Europe aims to ensure that very fast internet access will be available to all European citizens thanks to the deployment of next generation networks. This Agenda sets very ambitious and specific targets in infrastructure deployment. One of the objectives is to provide basic broadband coverage for all EU citizens and businesses by 2013 and Internet coverage of 30 Mbps or above for all Europeans by 2020.
Nevertheless, Europe is far behind schedule on this target. As stated in the Commission Digital Agenda Scoreboard (published 31-05-2011):
"The deployment and take-up of ultra-fast broadband is still low, and only 5% of all fixed lines deliver speeds of 30 Mbps and above, although 28.7% of households could have access to such speeds if they wanted to".
To come forward with concrete proposals to achieve the Digital Agenda targets required  intensive work during 4 months between more than 40 companies. The discussions focused around three main topics:
• Possible new business models for Internet development;
• Interoperability and standardization issues for next generation access and networks;
• Investment framework/models and financing sources to foster NGA roll-out.
In early July, we converged on 11 points, of which some touch on net neutrality discussions directly. In proposing a new ecosystem between over-the-top players and ISPs, we achieved a big step forward.

C&S:  Vivendi has a great deal of experience in the American market. Do you think that the Net neutrality debate is being approached on the same terms on both sides of the Atlantic?
J.-B. L.:  It is indeed relevant to compare Europe and the US on this issue, although there are significant differences.
On our side, we have seen the net neutrality issue being built and developed in the United States over the last three years by a coalition of Internet players, including Google. Until autumn 2009, the Federal Communications Commission (FCC) limited itself to setting out four open-Internet principles listed in the 2005 Internet Policy Statement, according to which consumers:
- can access the lawful Internet content of their choice,
- can run applications and use services of their choice,
- can connect their choice of legal devices that do not harm the network,
- are entitled to competition among network providers, application and service providers, and content providers.
Since 2009, only 2 new principles have been introduced by the FCC, according to which broadband providers:
- cannot discriminate against particular Internet content or applications (non discrimination),
- must be transparent about their network management practices.
The FCC approach to the net neutrality issue echoes a situation in the United States where the broadband market has structured itself into a duopoly. Consumers can access the services of either a cable or ADSL operator. The relatively limited competition results in a comparatively high subscription fee of above 100 dollars monthly for the equivalent of a triple-play offer.
In France, contrary to the United States, there has been significant investment from alternative operators over the past ten years. This competitive situation translated into monthly triple-play fees of only 30 euros. Therefore the economic balance is very delicate for the handful of players who have been able to survive.

C&S:  Although the intensity of Net neutrality discussions has not abated for several years now, we do get the impression of having moved past the staunchly ideological stage of conflict between the "libertarian" stance and the position taken by telcos.  Discussions today seem to be structured more around specific points, such as the role and potential place of managed services vs. Best effort. What, for you, are the crucial points that need to be considered?
J.-B. L.:  The main challenge ahead is to define how networks are able to handle the explosion of traffic on the internet and to design a framework that will create incentives for investment in networks and infrastructure.
In the short term, optimizing the use of bandwidth appears increasingly essential to manage networks effectively and avoid congestion, especially during peak hours. Traffic management techniques allow a better end-user experience regarding applications, content and services, notably through guaranteed quality of service and a more efficient use of the telecom operators' network resource.
Access to Best effort Internet is a service valued by the customers. Best effort internet is and should continue to be the "by default" option for all players, which means that consumers will continue to access all the content and applications they want. However there is a general desire for the market to explore other alternatives where all players might create more value out of content, applications and services.
That is why, at the July CEO Roundtable, the Industry recommended the creation of two-sided business models in the broadband market.
Two sided markets applied to telecoms would mean that, downstream, there is a relationship between ISPs and consumers, and, upstream, possibly but optionally, contractual relations between ISPs and content or online service providers to offer enhanced managed services.
The opportunity to develop upstream wholesale offers in the telecom market will enable very positive effect in leveraging the R&D of telecom operators to the benefit of content & service editors and, basically, allow some very specific services to keep working on the internet. It will also give ISPs stronger incentives to invest in next generation networks such as fibre, and thus ensure a better service for consumers.

C&S:  Universal Music became a pioneer in bundling access and services when it rolled out a music service for SFR subscribers, while Canal+ has increased its presence on the open web by launching innovative new services. What lessons have you drawn from these innovations?  From your experience, does the Net neutrality debate result in operational cooperation between telcos and the top content aggregators, in particular to improve the quality of over-the-top services delivered to internet users?
J.-B. L.:  Yes, absolutely. One of the key ideas that came out of the CEO Roundtable was to develop new commercial relationships between ISPs and over the top / content / service providers.
In online music, SFR and Universal Music Group (UMG) have both been pioneers in launching innovative services. SFR was the first telecom operator in France to launch an online store to download music on mobile devices and to allow ADSL customers to stream music on a large catalogue of titles. UMG is the world leader for digital music and has signed, in France, over 40 partnerships with online music platforms.
What we see as a general trend is that the market is moving progressively from download to subscription offers. SFR recently signed a deal with Spotify and all record companies (including, of course, UMG) to integrate its unlimited streaming music service to SFR subscription offerings.
Spotify is an interesting example since it has built its service on a very low bandwidth consumption profile. In fact, the service has been designed to allow people to store their playlists locally so they are able to play their music even if the connection is low or not available. This partnership is an example among many others of the trend towards more sophisticated relationships between over-the-top players and ISPs.
In the audiovisual and movie industries, we are also witnessing significant changes under the influence of Internet and particularly connected TV. This is why, in addition to regular broadcasting, Group Canal+ has been developing IP-related offers for several years now. These provide multi-screen viewing experiences allowing customers to watch their favourite programs anywhere and on any device (smartphones, tablets, PC, game consoles, etc.). They also include new on-demand services such as catch up TV and transactional VOD, as well as enhanced viewing experience with customized Electronic Program Guides or streaming stats during live sport events.
Even more recently, Group Canal+ announced the launch of CANALPLAY Infinity, an ambitious subscription VOD (sVOD) offer that will be available over all managed networks, as well as over-the-top on XBOX and connected Samsung TV. At SFR, the service will be integrated directly in the box interface so that subscribers will have the easiest access to it.
This example shows that both best effort and managed services can coexist and serve various objectives.

C&S:  Presuming that distributing services in the cloud is inevitable, how do you see the future of the home box? Is it a crucial asset for providers?
J.-B. L.:  Network and customer relationship are both essential assets for ISPs. The box bridges these two components: it is the network termination point and it materializes the ISP presence at the customer's home.
The box is progressively enhanced and improved to reflect the technology shifts and to meet consumer demand. The NeufBox Evolution for example is compatible with Fiber, Femto, 3G and ADSL. Moreover, the NeufBox Evolution is "green": it has an economy-mode function, it is the smallest box on the market and has many functions that provide enhanced Quality of Service and problems diagnosis.
The future versions of the box will integrate new functions to adjust to cloud services and to satisfy the multi-device expectations both at home and when out and about.

C&S:  France stands out as a special case when it comes to fibre rollouts, thanks to its system that combines a desire to promote private investment and infrastructure-based competition wherever feasible, with co-investment between operators in medium-density areas and public financing where necessary. What are your views on this system? Do you think it contains elements that could help accelerate the switch from copper to fibre-based access?
J.-B. L.:  As a general standpoint, we are obviously willing to invest in fibre infrastructure. SFR is already investing and this investment is going to increase to become massive. However each decision must be driven by a strong sense of pragmatism.
That is why we believe the best way to achieve fibre-roll out in France and, more generally in Europe, is via co-investment. We strongly advocate this model since this is the only way for European actors (both private firms and public authorities) to pool their capital in the most efficient manner possible and share the investment risk.
We are about to take some important decisions in this field, so I guess it is not the best time to have a look at what has been done yet: we have to look forward and focus on how to give a boost to fibre rollout objectives.

Short biography:
Jean-Bernard LÉVY was appointed Chairman of the Management Board of Vivendi on April 28, 2005. He previously served as Chief Operating Officer. From 1998 to 2002, Mr. Lévy was Managing Partner, Corporate Finance, at Oddo Pinatton. He was also Chairman and Chief Executive Officer of Matra Communication from 1995 to 1998. From 1993 to 1994, he was Chief of Staff to Gérard Longuet, the French Minister for Industry, and Foreign Trade. From 1988 to 1993, he was General Manager, Communication Satellites, of Matra Marconi Space. From 1986 to 1988, Mr. Lévy acted as Technical Adviser to Gérard Lonquet, the French Minister for Postal and Telecommunications services and from 1978 to 1986, he was an engineer with France Telecom. Mr. Lévy is a graduate of École Polytechnique and Telecom ParisTech. He is a Board Director of Vinci, Société Générale and Institut Pasteur.

For more information about our activities: www.comstrat.org

Contact
COMMUNICATIONS & STRATEGIES
Sophie NIGON
Managing Editor
s.nigon@idate.org

Interview with Hervé BARGE

COMMUNICATIONS & STRATEGIES No. 83, 3rd Quarter 2011
ICTs and health

Summary : The papers presented in this issue shadow the diversity of approaches related to ICT implementation within the health system. The particular position of health within our economies, the weight of public financing, the role of public authorities in the decision process to launch a new product and change health delivery systems, the vital issue of improved outcomes for users of health services, and the specific relationship between them and healthcare professionals: all of these issues help to explain why the health sector is often “late” in terms of ICT penetration.
The two interviews illustrate these challenges from an international and institutional perspective, with Fredrik LINDEN, Project Coordinator, Smart Open Services for European Patients, epSOS, and from a regional and operational perspective with Hervé BARGE, Chief Information Officer of the French regional health agency.

Exclusive:
Interview with Hervé BARGE,
Chief Information Officer of the French regional health agency
Conducted by Robert PICARD (CGIET)

C&S:  The French region of Franche-Comté is regularly cited as being on the cutting edge of the modernization of health information systems. How did this come about?
Hervé BARGE:  Since 2000 there has been a great deal of willingness to modernize the health information system in the Franche-Comté, first on the part of the Agence Régionale de l'Hospitalisation [ARH, regional hospital care agency] and then the Agence Régionale de Santé [ARS, regional health agency]. Senior public servants at the head of these administrations did not simply guess what they should do, but listened to a majority of health professionals who regularly condemned the lack of resources invested in information systems and tools for telemedicine.
The recruitment of a Chief Information Officer (CIO) specifically for information systems was a good first sign. In a number of regions, it has often been observed that individuals in similar positions were required to perform many other tasks and were unable to devote themselves completely to this specific job.  In my opinion, this point is one of the keys to success. The hierarchical position of the CIO, attached to senior management or the agency director, underlined the strategic importance of the information system to governance.
All regional stakeholders quickly understood the potential benefits of modernizing the information system and it has become a new source of power. Physicians quickly recognized that besides better case management for the patient, the information obtained by a global information system could be a gold mine. This "gold mine" would not only benefit the pharmaceutical industry, as some hinted; it would also benefit the quality of case management, ability to benchmark, statistics on actual activity, epidemiology and especially the evaluation of professional practices.
For some, Franche-Comté has some disadvantages due to its size and remote location, but in fact it is precisely its size and remoteness that made it possible to build on the regional traditions of co-operation well-developed in the traditional agricultural sector: communal cheese dairies is one demonstration of our ability to join forces. Franche-Comté has a population of only 1.2 million inhabitants; if we hoped to be able to invest in our entire region, we needed to pool our strengths and resources in order to develop the strategy wisely and show that this strategy could be efficient.

C&S:  What specific difficulties did you overcome in order to move forward?
H. B.: The problems in Franche-Comte may seem smaller but are nonetheless the same as in all regions; the competition between certain personalities and structures is just as intense.  Thus, certain engineers or information department managers did not understand that the profession of Information System Director in hospitals was destined to evolve just like the other professions of the field, e.g. towards more outsourcing, more skills and increasing specialization. After attempting to explain what could be accomplished by pooling our strengths, decisions occasionally had to be made bypassing entrenched stakeholders so as to maintain our momentum and not to drain our energy in unproductive infighting.
You can lead a horse to water but you can't make him drink… So, in 2004 after four years of collaborative work with two working groups (one technical, the other medical), initially without any legal framework, together with all the directors of private and public institutions in Franche-Comté and health network coordinators, one of the first Groupement de Coopération Sanitaire [GCS, health cooperation group] health information systems in France was created. This GCS was one of the first groups in the health information systems to benefit from shared resources.
Another stumbling block projects encounter is that a strategy is announced, but the financial means aren't there. The ARS has often funded between 50 and 100% of certain projects or services managed by the GCS Ensemble pour la modernisation des systèmes d'information de santé et le développement de la télémédecine [EMOSIST, Group for the modernization of health information systems and development of telemedicine]. ARS's choice to fund operating budget up to a total of 50% of the GCS EMOSIST was also carefully thought out. This solution has the advantage of striking a balance between oversight by the ARS and the GCS members, i.e. health networks as well as public and private hospitals. Even though the tensions inherent to all complex structures might occasionally arise, it appears that after five years a balance seems to have been struck. I also believe that a project approach made it possible to develop a real dynamic.  It didn't take long when payroll costs were increasing, for some people to think that there were too many "projects" and that they should be prioritized, even if this meant cancelling some. In the end, the GCS was a structure that enabled some "projects" to be brought together under a single heading of "SERVICE" and that overall the remaining projects were strongly demanded by members who provided ample funding. The evolution of this structure therefore has a life of its own, with periods of growth and periods of doubt; this is as it should be given that this is a new GCS. This concept of service is also an indicator of the value this structure creates.

C&S:  Exactly how can we measure the value added by this innovative approach?
H. B.:  This shared approach made it possible to quickly address the issue of value. Some institution directors and computer specialists were occasionally negative, along the lines of "nothing works on the regional level, the only thing that works is what I do at my place." It took the support of numerous medical teams as well as time for a certain number of projects to contradict the Solow paradox. In fact, everything takes time: it takes time for a system with a global approach to become efficient after it's set up (many applications are not designed to communicate with each other), time is needed for deployment, and time is needed for users to take ownership of them. When users hardly ever mention problems, other than to ask for upgrades, it can be said that things are working. We can only regret many early evaluations conducted with no respect for logic and within timeframes that do not take into account how long it takes for users to take ownership of the practices. What goes for the economy also goes for health; new evaluations and publications were needed to prove that the Solow paradox was wrong.
We can always add up the material and immaterial value of investments in our information systems, but I think that it is much more meaningful to look at the loss of value due to malfunctions in the health system to better understand the contribution of technology. We need to ask the question of what is the cost to society of a health care system, a shared patient record, and a medication system that comes to a halt and from which information is no longer available. How much would it cost if a tool for managing CVA (stroke) cases failed, even if for only one hour? Health professionals who have experienced breakdowns lasting a number of hours are staunch allies when talk turns to security and accessibility of data. The word "investment" in secure access to medical information no longer sounds like unproductive expenses and costs as it did prior to such breakdowns.

C&S:  What have you developed in your region in order to have the right information at the right time?
H. B.:  In Franche-Comté, certain patient cases are 100% computerized. In other words, the identities of the patient and health professional are closely linked, thus allowing complete patient-centred traceability. Subsequent to the heat wave of 2003, and under the impetus of the Direction Générale de l'Offre de Soins [DGOS, general directorate of health care supply], all Service d'Aide Médicale Urgente  [SAMU, emergency medical services] are completely computerized and able to electronically bring up thousands of items of useful information every day. In our region, we went further by incorporating the deaths from the region's admitting departments for all public and private institutions, and we have an infocentre where information is sent in to us every 15 minutes on the region's emergency activities, hence avoiding numerous entries and reprocessing. This query approach has been generalized to apply to all applications so that there would be no more guesstimates of the type "does it work or doesn't it; is someone there or not?" The query tools enable analysis what is going on in the system.

C&S:  What progress is being made in Franche-Comté on the patient's medical record?
H. B.:  Since 2000, our region has been working on a shared medical record that complies with international interoperability standards. All the work on the Dossier de Coordination Régionale [DCR, regional coordination record] enabled us to easily get the national Dossier Médical Personnel [DMP, personal medical record] and to work with the DMP Groupement d'Intérêt Public [GIP, public interest group] and then the Agence des Systèmes d'Information Partagés de santé [ASIP, shared healthcare information systems agency] to give them the benefit of our experience.
Beyond the national project, regionally coordinated records make it possible to improve sharing of information between medical applications and health professionals in the interest of both patient and health professional. The regional information system allows the various health professions to share the greatest possible amount of important information. The objective is to be as secure as possible while permitting better traceability and sharing of medical information. There is no competition between these records and the national DMP. The DMP is well defined; the legislative system wanted it and it is the patient's personal record. The DCRs are instruments that can supplement the national DMP as needed, but above all they are instruments to allow exchanges between the numerous health software programs. A few applications in the region operate perfectly and some manage 100% of patients' cases such as Bonnes Pratiques en Chimiothérapie [BPC, good practices in chemotherapy], a software package thought up and designed by the Besançon Centre Hospitalier Universitaire [CHU, university hospital] and developed by the SQLI database management software. This regional tool makes it possible to prescribe, make, and dispense all of the region's chemotherapy. This enables the region's patients and professionals to move between health structures without interruption in case management, by using national and international repositories. This software also makes possible exchanges between applications that manage the multidisciplinary meetings and the cancerology communication record without having to enter data twice. The atypical antibody screens (transfusions) sent by transfusion centre-specific programs to those specific to the blood bank also allow greater security for caregivers by preventing transfusion-related accidents.

C&S:  Let's go back to the strategy in Franche-Comté. How did you go about developing it?
H. B.:  This high degree of interoperability permits implementations that are interconnected like the pieces of a puzzle. As long as the final target is known, a project can be implemented if it is centred on common practices and the components (patient identities, health professional identities, directories, patient records, etc.) defined in detail in the Integrating the Healthcare Enterprise (IHE) approach. We have implemented our entire strategy using two techniques: The Proof of Concept (POC) to quickly show what works to gain the support of health professionals; and the "siphon technique", meaning going ahead and initiating the POC and the following phases before everything is in place. This speeds up production without committing total funding. Even though it is necessary to have some idea of what the project will ultimately cost, funds are committed gradually and indicators defined to track what is being funded and for which results. On the payer's side, such as the ARHs, there is less risk. If the phase 1 commitment is not successful, there is no point in committing further funds, and it is easier to accept losing a small amount of money.  I have often observed that in the case of failed projects, the entire budget envelope had been released and there is no room to manoeuvre, and in numerous other undertakings, project leaders wait for all the lights (and there may be many) to turn green.

C&S:  What are you are working on now?
H. B.:  After ten years of work in the region, we are currently setting up new knowledge and technology transfer structures in a Living Lab approach with an institute specifically created for this purpose. The Institut Edouard Belin is setting up industry/user partnerships centred on the theme of seniors' independence. Numerous projects are underway and we are implementing an R&D program with an information system that goes to where the patients live. In addition to the educational aspects, this Living Lab aims to provide a framework in which to reflect on and implement prototypes created by industry partners. Health professionals are not the only ones participating and giving feedback; the users and potential patients do as well.

For more information about our activities: www.comstrat.org

Contact
COMMUNICATIONS & STRATEGIES
Sophie NIGON
Managing Editor
s.nigon@idate.org