Driving Digital Communications Ahead
Special edition of Trends presents 4th generation regulation
Dubai, 31 March 2014 – A special edition of Trends in
Telecommunication Reform was launched today at the ITU World Telecommunication
Development Conference (WTDC-14) in Dubai. Highlighting the theme ‘4th
Generation Regulation: Driving Digital Communications Ahead’, the report
explores the policy and regulatory issues coming to the fore as the ICT sector
accelerates into a broadband ecosystem of evolving applications and services.
“The ICT sector transforms, converges and evolves at a dynamic pace,” said
ITU Secretary-General Hamadoun I. Touré. “The role of the regulator is itself
subject to redefinition and evolution.”
Mr Brahima Sanou, Director of ITU’s Telecommunication Development Bureau,
noted “This special edition of Trends captures the unrelenting pace of change in
the development of ICTs – as well as the diversity and adaptability of
regulatory practices that have evolved in response to this change.”
The report highlights that access to online services today is vital in order
to find a job, receive a salary, pay bills and taxes, vote, learn and conduct
business. Governments throughout the world are striving to bring ICTs to
everyone. ICT regulators recognize that in such a fast-changing and dynamic
environment, new regulatory paradigms – a fourth generation of regulation – are
essential to drive digital communications forward. Allowing ICT markets to
thrive today is a matter of finding the balance between creating the right
incentives and enforcing necessary rules. With the move towards more ex-post
regulation, the barriers to market entry are gradually decreasing in virtually
all market segments, opening the way to new market players and new business
models.
The Trends report finds that the full development of the digital ecosystem is
now heralding a fourth generation of regulation. Broadband networks and Internet
services are increasingly viewed as non-optional utilities (or “rights”) whose
availability and performance impact every aspect of the economy and societal
development. The “fourth-generation regulator” must oversee an increased range
of services, delivered over multiple broadband and converged networks that form
the digital ecosystem. More than ever before, regulators are now being asked to
protect consumers from a slew of ills such as inappropriate content, faulty
billing and fraudulent online activities. So important is the Internet, that
fourth-generation regulators are increasingly becoming involved not only in the
economic necessity of building affordable access, but also in the attendant
social opportunities and challenges arising from better-connected communities.
The report also explores the issue of TV White Spaces, known as TVWS. The
term usually refers to unoccupied portions of spectrum in the VHF/UHF
terrestrial television frequency bands. While trials and tests are under way in
some countries to improve the utilization of this highly valued spectrum
resource by implementing sharing between the primary television service and
other services such as wireless broadband applications, It is important, to
identify, from a regulatory perspective, the potential TVWS trade-offs in
relation to the goals set for the national ICT strategy.
According to the report, the emergence of the Internet has radically changed
technology approaches, market philosophies and regulatory paradigms of the
telecommunication industry. Regulators are still coming to terms with these
changes in ways that will advance the development of the digital economy. With
regard to interconnection, the fusion of Internet and telecommunication
regulation can best be achieved through adhering to sound regulatory principles
described in the chapter.
The report also examines how new means of delivering content are being used
as new business models emerge, with online advertising now rising as a key
source of revenue. This consolidation across the value chain is underlined by
just how much has changed in the last few years in terms of cross-ownership and
the battle between telecommunication operators and over-the-top players.
There is a growing recognition that existing regulatory regimes should be
adapted to deal with the realities of the converged marketplace. The huge growth
in data being carried over telecommunication networks, and the increased
importance of managing traffic flows, means that net neutrality is likely to
remain an important issue on regulators’ radars.
Exploring digital transactions and the mobile payments market, rapid growth
has been seen, with the total value of transactions nearly doubling every year
from 2009 through 2012. Market commentators and forecasters expect this
growth to continue apace for the foreseeable future. Seen broadly, this has
been, and will be, a global phenomenon.
Another important area of digital transactions is rapidly being adopted, and
with it comes to increasing attention from regulatory bodies and legal systems:
virtual currencies. It is assumed that policy-makers and regulatory bodies
are balancing two broad aims when it comes to mobile payments and related
services. The first is to ensure that any new financial services are regulated
to protect consumers and prevent misuse. The second encourages the development
of services which will potentially bring significant economic and social
benefits.
The report highlights the incredible potential of the Internet as a unique
economic enabler, generating an estimated value exceeding USD 14.4 trillion in
the next ten years. Yet, currently, 99.4 per cent of physical objects that may
one day be part of the ‘Internet of Everything’ are still unconnected. Moreover,
large areas of the world remain unserved or under-served by Internet
connections. One of the key technologies that can enable progress in Internet
connectivity is Internet Protocol version 6 (IPv6). Industry statistics show
that, in fact, IPv6 is entering the market at a respectable pace. But will it be
enough to meet the demand for Internet growth? According to the report,
government policy-makers and regulators have not been passive in promoting
efforts to build capacity, deploy infrastructure and urge the adoption of IPv6,
and regulators have had a foundational role in ensuring that regulations
governing licensing, interconnection and numbering resources are aligned with
efforts to promote the transition to IPv6.
The Trends report concludes that the previous regulatory categories no longer
cover all the activities occurring in the sector. In the end, 4G regulation is
about evolution, not radical change. As in a family or society, lessons learned
from the past – or from other regulators dealing with similar changes – retain
their usefulness as they are applied to novel situations. The past is merely a
prologue, and the future will be one of opportunity and diversity in
technologies and services. This special edition of the ITU Trends Report is
available at
www.itu.int/trends-special.
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