Saturday, July 09, 2005


Tinkering on converged licensing The fifth annual gathering of Global Symposium for Regulators (GSR) ended recently in Geneva, Switzerland with ‘licensing in an era of convergence’ discussed, reports Remmy Nweke.

IN living up to the challenges facing humanity and determined to ameliorate them through Information and Communication Technology (ICT), the International Telecommunication Union (ITU), is tinkering on one license for a converged ICT services.

This indication came at the just concluded Global Symposium for Regulators (GSR), held in Geneva, Switzerland, last December, following the adoption of the report: Trends in Telecommunication Reform 2004-2005 by GSR. With this, the ICT sector, no doubt, is undergoing a radical transformation from an industry based previously on “Plain Old Telephone Services” (POTs), to one that provides voice, data and multimedia applications.

At the same time, countries around the world are now gearing up in the process of updating licensing and regulatory frameworks to address this convergence to better promote affordable access to technologies, especially through the Internet and broadband.

GSR had also expressed a shared goal to create national regulatory frameworks that would be flexible and enable competition between multiple private sector service providers, who may want to utilise a variety of technology platforms and delivery options.

For the Director, ITU-Telecommunication Development Bureau (BDT), Mr. Hamadoun I. Toure, “Technological innovations and market developments are forcing telecommunication regulators to rethink their regulatory practices.”

He stressed that the reality is that with a full range of ICT services and devices available on different networks, “regulators must face the question of whether licenses that limit operators to specific services or technologies still make sense”.

ITU had noted that Broadband technologies are seen as a particularly efficient way to achieve the connectivity goal because of their ability to overcome distance, open up markets, and create employment while reducing costs.

Chairman of the GSR and Commissioner of the United States Federal Communications Commission, Ms Kathleen Abernathy, said “Broadband networks are the key to maximizing the promise of an evolving and converging ICT sector,” noting, “new wireless and converging technologies that are sure to follow could revolutionize our societies and help to close the broadband divide that exists within and among our countries.”

The regulators, further said, that in order to achieve global connectivity and to reap the social and economic benefits this will bring, could only be possible if there is fair and reasonable access for competitive broadband services, including Internet connectivity.

Mr. TourĂ© applauded the work of regulators from the developing world in this area, saying, “in many ways they are pioneering innovative uses of technologies such as broadband and the regulatory frameworks needed to support those innovations.”

The 2004-05 edition of the annual ITU publication, “Trends in Telecommunication Reform” focused on the global trend to reduce licensing requirements and to adopt converged licensing regimes that will enable service providers to offer any and all services using the technology of their choice.

Champion Infotel recalled that the fifth Forum on Telecommunication Regulation in Africa (FTRA), held in Kampala, Uganda, between November 3 and 5, 2004, also focused on “Licensing in the era of convergence”.

This covered specifics such as the impact of convergence on existing infrastructure, technology neutral licensing, pricing of spectrum in the era of convergence, regulatory implications, electronic numbering (ENUM) or Internet Telephone Numbering System in a convergent environment, country report on regulatory activities and regional and international corporation concerns.

FTRA requested ITU to assist countries in enhancing this capacity through publications, consulting mechanism and provision of training, as well as the issue of an appropriate regulatory framework to accommodate convergence, noting that the most appropriate regulatory framework, in the convergent environment was based on technology and service neutrality, even as they advised countries to consider adopting technology and services neutrality that is most appropriate for them.

The forum deliberated at length the utilization and pricing of spectrum in the era of convergence and said that spectrum should be properly attributed and managed by a relevant authority, giving due consideration to Africa’s plan to develop rural communication through wireless technology.

With regard to the perceived dependence of regulators on revenues from licenses to support their operations, the forum noted the likely effects of reduced revenues as a result of issuance of a single license.

However, the report highlighted the global trend towards reducing licensing requirements and adopting converged licensing regimes that will enable service providers to offer any and all services using the technology of their choice in a more competitive market environment.

Increasingly, policy-makers are revamping licensing frameworks to make them more flexible and more converged through various approaches, which is good. Though some approaches favoured a generic or converged licence for all providers of telecommunication services, regardless of what technology they deploy or what specific service niche they target.

The number of regulatory authorities around the world had risen to 132 by mid-2004 from 117 in 2003; reflecting the general pattern of growth that has marked the ICT sector for over a decade, according to ITU regulatory database.

This trend towards institutional convergence continued into 2004, as existing regulatory authorities merged and new, converged ones were established from scratch. For example, in the United Kingdom, five separate agencies merged to form the Office of Communications (OFCOM) that became operational at the end of 2003.

These were the Office of Telecommunications (Oftel), the Broadcasting Standards Commission, the Independent Television Commission (ITC), the Radio Agency and the Radiocommunications Agency.

Whereas in Brunei Darussalam, the Authority for Info-communications Technology (AiTi) was created and entrusted with responsibilities in both telecommunication regulation and ICT industry development.

Thus trend towards institutional convergence commensurated with the expanding role regulators are expected to play in developing national ICT markets. To achieve their tasks, a number of regulatory authorities have become ICT enablers and promoters, supporting the development of new technologies, new services and new business models, even as for many regulators, ICT capacity-building and consumer outreach have become key mandates.

Though this is a noble step, there seem to be some nagging questions begging for answers. These include as a technological, market and regulatory trend, convergence is raising a dizzying array of regulatory and legislative issues that policy-makers and regulators will have to address, particularly in the area of licensing.

The sixth edition of Trends in Telecommunication Reform, however, explored many of these issues in a bid to launch a global dialogue on licensing and convergence in the ICT sector. For example, can policy-makers and regulators completely deregulate the licensing of spectrum? How can they move to a converged licensing framework without unduly benefiting either incumbents or new market entrants? If new and existing participants in the market are less tightly licensed, how can regulators ensure that the public interest is served appropriately? Can governments pull back on licensing and still push operators to attain societal objectives such as universal access? What is clear is that a number of pioneering governments are revamping their licensing and regulatory frameworks with the goal to better promote affordable access to the entire gamut of communication services from voice to high-speed Internet access.

Historically, service providers have used different types of networks to deliver voice, video and data offerings, as such, end-users typically use different equipment to receive these services. In a number of countries today, licensing requirements for many services are being eased in order to remove barriers to market entry and boost competition.

Instead of requiring individual licensing and lengthy application procedures, general authorizations are increasingly used for a growing number of services. A prime example of this trend could be found in the member states of the European Union (EU), following the directive of EU Parliament since March 7, 2002, which has taken a major step to create a single licensing classification for all electronic communications and has created more consistent licensing throughout its 25 member states.

With the exception of assigning radio frequencies and numbers, the EU has replaced individual licences with a general authorization to provide all electronic communication networks and services under a new regulatory framework for electronic communications.

This new regulatory framework that entered into force in July 2003 is also technology neutral, and aims to be sufficiently flexible to deal with converging markets. The authorization rules lay down an administratively simple, light-touch procedure allowing companies to enter markets quickly.

But despite its flexibility, the new regulatory framework still requires constant evaluation and review, and this reports recommended such a review for EU before 2006, so as to further discuss issues related to authorization and convergence.

Already in Africa, Kenya and Tanzania are known to be in the process of introducing a converged licensing regime. While the introduction of more flexible and straightforward licensing regimes is clearly the trend today, regulators are nevertheless confronted with a large number of challenges and choices in their progress towards this ideal.

Beyond the adoption of a converged licensing model, issues such as spectrum management, the setting of licence fees, ensuring a level playing field and the pursuit of public policy goals, including universal access, also have to be dealt with as part of the process, and if left unchanged, the licensing process could be an obstacle to the development of a telecommunication market.

This symposium brought together the heads of 54 national regulatory authorities from both developed and developing countries, with representatives from 106 countries, attracting 350 participants, and has a reputation as the most important global venue for regulators to share views and experiences by fostering an open dialogue amongst themselves and with key stakeholders, including the private sector, investors and consumers.

This is coming at a time when a crop of Nigerian IT professionals is calling for a distinct IT ministry apart from what exists currently. Although, major contention here is the licensing authority ability to contend with the new era, which entails further empowering the Nigerian Communications Commission (NCC) in the case of Nigeria.

Probably, for this desire by global regulators to take its root in the country, it requires an enlarged NCC with sub-directorates or commissions to represent different aspects of ICT services.

This is important in getting the nation ready for global competitiveness.

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