Introduction to RegulationIdongesit Williams, PhD StudentCMI, Aalborg Universityidong@plan.aau.dkCentre for Communication ...
Outline• General overviewWhat is regulationWhy regulateWhat can be regulated• ICT regulationsWhat must be regulatedWhy, wh...
What is Regulation?• Regulations can be seen as implementationartefacts of policy statements. They make uppolicy statement...
What is usually regulatedA good of public /national interestA good, where the demand for a good or service isconsidered a ...
Why Regulate?Regulation mandated by a state attempts to:1. Produce outcomes which might nototherwise occur, (eg. Facilitat...
What can be regulated?• controls on market entries• prices• wages• Development approvals• Pollution effects, employment fo...
ICT/Telecoms RegulationsTraditionally it was aregulation of monopolies,(mainly Post and Telecoms(P&Ts))Now it regulation o...
What must be regulated?Monopoly CompetitionTariffsQuality of serviceUniversal serviceobligationScarce resourcesInterconnec...
Why What HowMonopoly Protect monopolyTechnicalEfficiencySocial andIndustrial policyTariffsQuality of serviceUniversal serv...
Drivers of change in telecom policies from monopoly to competitionEconomic PoliticsTechnology1st stage1990-Liberalization ...
Implications: new regulatory policiesMarket/ Policy Technology Services ApplicationMonopoly Analoguetechnologies(circuit s...
Types of Telecom regulation• Public ownership– A part of the public administration– Public owned corporation• Legislation–...
Regulatory Framework• Government: Decide on the regulatoryframework, structure and implementation.Creates the regulator.• ...
Implications of Technology Change• Unbundling of the PSTN to several horizontaland vertical disintegrations.• More players...
Principal objective of telecomregulationThe service should be made available to everyone on reasonable terms,sometimes whe...
Regulator• Management of scare resources (spectrum, numbering, right ofway)• Responds to the challenges made possible by n...
Types of Regulators• Single sector regulator (Oversee only one sector,eg only telecoms)• Converged sector regulator (Overs...
Regulatory organization structure• The collegial body: A board or commission composedof multiple members. Here individuals...
Best practice for setting up a regulator• Regulators must be independent to be seen astransparent and accountable.• Regula...
Characteristic of a good regulator• Accountability• Transparency• PredictabilitySome areas to regulate competition• Local ...
Government’s responsibilityMust grant the regulator structural, financial and functionalityindependence• Structural: Free ...
International frameworks• Countries make global and regional commitmentsto open the telecommunication market to foreigninv...
Assessing a country’s regulatoryframework• Greater economic growth• Increased investment in the sector• Lower prices• Bett...
Summary• Regulation is an important tool to ensure public interest inthe telecoms market• Technology, Economics and politi...
Upcoming SlideShare
Loading in …5
×

Introduction to telecom regulation

460 views
363 views

Published on

This lecture provides an overview to the trend of telecom regulation over the years

Published in: Education, Business, Technology
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
460
On SlideShare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
37
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Introduction to telecom regulation

  1. 1. Introduction to RegulationIdongesit Williams, PhD StudentCMI, Aalborg Universityidong@plan.aau.dkCentre for Communication Media and Information Technology
  2. 2. Outline• General overviewWhat is regulationWhy regulateWhat can be regulated• ICT regulationsWhat must be regulatedWhy, what and howDriver of change from monopoly to competitionImplication of technology changePrincipal objective of telecom regulationTypes of telecom regulations• Regulatory FrameworksRegulatorTypes of regulatorsRegulatory organization structureBest practice for setting up a regulatorCharacteristics of a good regulatorGovernment’s responsibilityInternational frameworksAssessing a country’s regulatory frameworkSummaryCentre for Communication Media and Information Technology
  3. 3. What is Regulation?• Regulations can be seen as implementationartefacts of policy statements. They make uppolicy statements1. Levi-Faur, David, Regulation and Regulatory Governance, Jerusalem Papers in Regulation and Governance, No.1, 20101Regulation is administrative legislation that constitutes or constrainsrights and allocates responsibilities. It can be distinguished from primarylegislation (by Parliament or elected legislative body) on the one handand judicial decisions on the other hand [1]Centre for Communication Media and Information Technology
  4. 4. What is usually regulatedA good of public /national interestA good, where the demand for a good or service isconsidered a commonnecessity for the public at large, and the supplyconditions are such that the public maynot be provided with reasonable service atreasonable prices, the government mayregulate to ensure that the service is available toalltelecoms watertransportelectricity***The general need to regulate varies from country to countryCentre for Communication Media and Information Technology
  5. 5. Why Regulate?Regulation mandated by a state attempts to:1. Produce outcomes which might nototherwise occur, (eg. Facilitatecompetition)2. Produce or prevent outcomes in differentplaces to what might otherwise occur, (constructive or destructive outcomes)3. Produce or prevent outcomes in differenttimescales than would otherwise occur(market failures)Centre for Communication Media and Information Technology
  6. 6. What can be regulated?• controls on market entries• prices• wages• Development approvals• Pollution effects, employment for certainpeople in certain industries• Standards of production for certain goods• The military forces and servicesCentre for Communication Media and Information Technology
  7. 7. ICT/Telecoms RegulationsTraditionally it was aregulation of monopolies,(mainly Post and Telecoms(P&Ts))Now it regulation of bothmonopolies, duopolies andcompetitive marketsMonopoly CompetitionEconomies of scaleTechnical efficiencyLow interconnectioncostsPublic interestobjectivesOrganisationalefficiencyPressure on tariffsInnovativenessNew servicedevelopmentCentre for Communication Media and Information Technology
  8. 8. What must be regulated?Monopoly CompetitionTariffsQuality of serviceUniversal serviceobligationScarce resourcesInterconnectionTransparency(Cross subsidisation)Centre for Communication Media and Information Technology
  9. 9. Why What HowMonopoly Protect monopolyTechnicalEfficiencySocial andIndustrial policyTariffsQuality of serviceUniversal serviceobligationDirect:OwnershipInformal guidanceCompetition EffectivecompetitionCoherentInfrastructureScarce resourcesInterconnectionTransparency(Crosssubsidisation)Indirect:LegislationMarket incentivesCentre for Communication Media and Information Technology
  10. 10. Drivers of change in telecom policies from monopoly to competitionEconomic PoliticsTechnology1st stage1990-Liberalization policy broke uppublic monopolies into privatemonopolies-- Separation of Post from telecoms- Establishing a separate regulator2nd stage-Privatization of monopolies- Opening up markets- New licensing framework3rd stage- Exclusivity of incumbent ends- Full competition begins- Regulation of competitionFixed: PSTN (Using Analogue switches)--- ISDN (digitzation)---DSL---- ADSL---- future broadbandWireless- Radio transmission---GSM--- UMTS--- LTE– WiMAX---- future broadband.Globalization hasled to Newunbundledmarkets, newinternationalpolicy frameworkthat hasproduced newbest practicesCentre for Communication Media and Information Technology
  11. 11. Implications: new regulatory policiesMarket/ Policy Technology Services ApplicationMonopoly Analoguetechnologies(circuit switching)Voice telephony Voice callsMonopoly,DuopoliesPacket switchingand Digitization(x.25, ISDN,analogue mobile)Voice + Data service SMS, Voice calls, FaxCompetition;LiberalizationPrivatizationCommercializationDeregulationCorperatizationDigitization has ledto Broadband,Internet protocol(GSM, UMTS, LTE,WiMAX, WiFi, DSL,ADSL, HSPA, etc)Voice + Data service+ Multimediaservices + lots moreVoice, MMS, SMS,VOIP, IPTV, DVBH,Streaming etcPolicy trendCentre for Communication Media and Information Technology
  12. 12. Types of Telecom regulation• Public ownership– A part of the public administration– Public owned corporation• Legislation– Licensing– Rights and obligations– Competition laws• Market incentives– Taxes and subsidies– Tradable permits• Self RegulationCentre for Communication Media and Information Technology
  13. 13. Regulatory Framework• Government: Decide on the regulatoryframework, structure and implementation.Creates the regulator.• Regulator: Executes the regulation• Market players: Networkoperators, equipment manufacturers, contentproviders, content aggregators, equipmentretailers/suppliers, etc• PublicCentre for Communication Media and Information Technology
  14. 14. Implications of Technology Change• Unbundling of the PSTN to several horizontaland vertical disintegrations.• More players, Network providers, contentproviders, content aggregators, applicationproviders, equipment manufacturers,equipment suppliers etc.• Movement for diverged service platforms to aconverged service platforms.Centre for Communication Media and Information Technology
  15. 15. Principal objective of telecomregulationThe service should be made available to everyone on reasonable terms,sometimes whether or not it is profitable to do so.The services should satisfy the full range of consumer demand and be suppliedunder conditions of optimal efficiencySocial/Political interest: Availability of service and continuity.Economic interest: Prevention of monopolistic behaviour to avoid failure, Promotionof competition through incentive regulations , Use of scarce resources in an efficientway.Centre for Communication Media and Information Technology
  16. 16. Regulator• Management of scare resources (spectrum, numbering, right ofway)• Responds to the challenges made possible by new technologies thatwill raise the need for a new regulation, eg privacy concerns IPR etc.• Manages the evolving markets made possible by convergence• Tackles how to deal with disruptive technologies and how toprotect public interest when they discover that the market for thenew technology cant take off because of the impediments informer regulations that prevent it. (eg voip and IPTV)• It is advisable for the regulator to inform the public on thelimitations that comes with new technologies. This isnt verypracticalCentre for Communication Media and Information Technology
  17. 17. Types of Regulators• Single sector regulator (Oversee only one sector,eg only telecoms)• Converged sector regulator (Oversee severalinter-relating sectors eg, Telecoms, broadcast,electronic payment)• Multi sector regulator (Oversee sectors withcommon economic and legal xteristics eg,telecoms, water, energy, transportation. Underone umbrella)• A competition authority (no regulator as such butapply competition and anti trust rules)Centre for Communication Media and Information Technology
  18. 18. Regulatory organization structure• The collegial body: A board or commission composedof multiple members. Here individuals are withdifferent expertise, more independent, butdevelopment of regulation may be slower due tointernal wrangling• The single regulator: Often led by a chairperson orpresident. single regulator has benefit of consistentapproach to regulation and decision making. They canact quickly but can be influenced by external actors.he/she may not be able to match the expertise of thecollegial bodyCentre for Communication Media and Information Technology
  19. 19. Best practice for setting up a regulator• Regulators must be independent to be seen astransparent and accountable.• Regulators should have the expertise to assess andmake sound judgements on both technical andindustry specific issues.• Regulators must take into account various view pointsand interests, including economic, social and politicalobjectives. there should be checks and balances.• The institutional design, internal structure andadministration must be sufficiently flexible to allowthe regulator to respond to market realities.Centre for Communication Media and Information Technology
  20. 20. Characteristic of a good regulator• Accountability• Transparency• PredictabilitySome areas to regulate competition• Local services• Domestic long distance service• International long distance services• Mobile• Internet services• Leased linesCentre for Communication Media and Information Technology
  21. 21. Government’s responsibilityMust grant the regulator structural, financial and functionalityindependence• Structural: Free from political and industry capture toensure transparency and objectivity.• Financial: Funding should be free from private and politicalinterests. The regulator should manage its funds and alsohave multiple ways of sourcing for funds• Functionality: The regulator should be independent inmaking and enforcing authority, dispute resolution powers,clear rule involving appointment , removal and mandate ofregulatory authority, incentives to promote professionalexpertise of staff, adequate provisions to address ethicaland conflict-of-interest-concerns.Centre for Communication Media and Information Technology
  22. 22. International frameworks• Countries make global and regional commitmentsto open the telecommunication market to foreigninvestment• They also make commitments to harmonizelegislation with that of other countries in similargeographic or economic situationsEg EU framework, WTO, NEPAD etcThe advantage of this could be the development of global orregional regulatory best practices.It can also grant the telecoms investor a level of certainty andpredictability of the regulatory regime in the country he or shewants to be a part of.Centre for Communication Media and Information Technology
  23. 23. Assessing a country’s regulatoryframework• Greater economic growth• Increased investment in the sector• Lower prices• Better quality of service• Higher penetration and a more rapidinnovation in the sectorCentre for Communication Media and Information Technology
  24. 24. Summary• Regulation is an important tool to ensure public interest inthe telecoms market• Technology, Economics and politics are the driving force fornew regulations and the initial movement from monopolyto competition markets• Tariffs, interconnectivity, scarceresources, transparency, Quality of service, UniversalAccess and Services are some of the areas regulated intelecommunications• Telecommunication is regulated to promote its social andeconomic benefits to citizens of a country• A regulator must be independent to function properly• Countries do sign up with international regulatoryframeworks to enable them develop best practicesCentre for Communication Media and Information Technology

×