Enlightened ICT regulation can play the role of ‘stimulus plan’
Complex challenges of a converging, multimedia world
Geneva, 9 March 2010 — While
demand for information and communication (ICT) services like mobile telephony
and broadband Internet remains strong, the global economic crisis is
jeopardizing ongoing investment in network rollouts and technology upgrades, a
new ITU report finds.
The 10th edition of Trends in Telecommunication Reform, ITU’s flagship
annual report on the state of ICT regulation worldwide, argues that enlightened
ICT regulation can effectively play the role of a ‘stimulus plan’, driving
network investment, growth and development. The report draws on the discussions
held during ITU’s annual Global Symposium for Regulators (GSR), which was held
last November in Beirut, Lebanon and welcomed over 600 regulators from around
The economic crisis has served as a wake-up call on the importance of
effective regulation and raised questions about the role of government and the
laissez-faire approach that had prevailed — especially in the financial sector.
Government and industry are now being forced to reassess their roles and the
need for state intervention to ensure, among other things, the development of a
new ‘broadband economy’.
ITU argues that regulators and policymakers can proactively address the risk
of under-investment in tomorrow’s networks through a two-pronged approach that
looks at how governments lend money to the private sector through Public-Private
Partnerships, ICT stimulus plans and other funding programmes; and how effective
regulatory strategies and policies — both financial and non-financial — can play
their part in maintaining the momentum. But to be effective, these strategies
must be underpinned by strong regulatory institutions and transparent policies
and procedures — the bedrocks of effective regulation.
"With technological convergence now blurring the lines between telephony,
broadcasting, and online services, ICT regulators play a key role in fostering
ongoing innovation and competition, enabling operators to adopt the latest, most
powerful technologies, and ensuring consumers enjoy the very best range of
services at the lowest possible prices," said ITU Secretary-General Dr Hamadoun
The ITU report maintains that, regardless of changes in investment appetite,
negative capital market conditions, and financial crises, the size of the
investor universe and the diversity of investor objectives will ensure that ICT
sector investment remains robust and varied.
"Although the global ICT industry has seen reduced sales in equipment and
manufacturing, lower demand and curtailed investment, the sector confronted the
crisis more successfully than did many other sectors," said Sami Al Basheer Al
Morshid, Director of ITU’s Telecommunication Development Bureau. "Certain
markets — namely mobile cellular and Internet — have been buoyant. And because
of the business opportunities they represent, developing countries remain
attractive — especially those that have embarked on regulatory reform
initiatives. But the answers to many of the complex regulatory questions now
facing the industry are still far from clear — which is why the GSR has become
such a key global event."
Mobile growth continued unabated in 2009, with global mobile subscriptions
expected to reach 5 billion in 2010. At the same time, mobile broadband
subscriptions topped 600 million, having overtaken fixed broadband subscriptions
in 2008, highlighting the huge potential for the mobile broadband Internet
industry. The number of Internet users also grew steadily, with some 1.8 billion
users worldwide by the end of 2009.
The creation of independent ICT regulators has been one of the main building
blocks of regulatory reform. The number of separate telecom/ICT regulatory
authorities in markets around the world increased from just 12 in 1990 to 153 at
the end of 2009. Regulators have gradually opened fixed line services to
competition, so that at end 2009 65% of countries now have competitive markets
for basic fixed-line services, and 90% for mobile cellular services. In
addition, 124 national fixed-line incumbents have been privatized along the way.
New challenges in a converging world
The report also confirms that converged technologies are boosting
competition. Voice over IP (VoIP) services allow broadband, cable modem and
wireless service providers to compete directly with one another, as well as
promoting competition by enabling new service providers to compete without
owning their own network infrastructure.
But changes in technologies and market conditions also raise new consumer
protection issues. From a consumer’s perspective, more competition may lead to a
bombardment of marketing material, masquerading as information. This is
especially the case where access to high-speed broadband connections makes
consumers easily accessible, day and night, as advertising targets.
In the ‘always-on’ environment, consumers may also be unaware of how to
protect themselves and their families from harmful or offensive content. Meeting
the needs of the connected consumer therefore needs to look at potential gaps in
current regulatory practices that should be addressed to protect consumers more
This year’s edition of Trends in Telecommunication Reform comprises
ten chapters focusing on new market expectations, and identifying the different
regulatory approaches taken around the world to stimulate ICT growth and
increase access to broadband services.
An Executive Summary of the report is available at: www.itu.int/ITU-D/treg/publications/trends09.html
The report is on sale to ITU members and the general public and can be
purchased online at: www.itu.int/publ/D-REG-TTR.11-2009/en
For more information, please contact:
Media Relations and Public Information, ITU
||+41 22 730 6135
||+41 79 599 1439
Regulatory Officer, ITU
||+41 22 730 6100