Convergence and economic growth

by david.nunes
Alan HorneIssue:Africa and the Middle East 2008
Article no.:6
Topic:Convergence and economic growth
Author:Alan Horne
Organisation:Arab Network of Telecommunications Regulators and General Director, Telecommunications Regulatory Authority of Bahrain
PDF size:212KB

About author

Alan Horne is the President of the Arab Network of Telecommunications Regulators and General Director of the Telecommunications Regulatory Authority of Bahrain. His work regularly involves advising Ministers and Ministries and chairing industry working groups. In Lebanon, he served as project manager of a European Commission funded project to assist with the establishment of an independent telecommunications sector regulator. Mr Horne has represented major enterprises at ETSI, on the European Telecommunications Platform (ETP) group and the European Competitive Telecommunications Association (ECTA). Mr Horne was the founder of InterConnect Communications Ltd, a consulting company specialising in regulations covering television, radio, telecommunications and wireless communication services, later sold to Telcordia Technologies. He also served as Director of European Product Management at Mitel Networks, as the head of Private Systems Software Development for Phillips and at BT. Mr Horne is a Member of the Institute of Directors (IOD), the Institute of Electrical Engineers (IEE) and the Communications Managers Association (CMA). He has regularly organised, chaired and spoken at major telecommunications conferences run by IIR, IBC, ITU and InterConnect/Eurostrategies. Mr Horne is also the co-author of a number of publications. Alan Horne earned a First Class Honours degree in Electronic Engineering and a Masters in Telecommunications.

Article abstract

ICT convergence raises a good many issues that regulators need to deal with if ICT are to be used effectively as a tool for economic and social development. The merger of fixed, mobile, data, voice and broadcasting has changed the business models of all those in anyway involved. Convergence offers great opportunities for social and economic development, but raises thorny problems for regulators that must see that the opportunities can be put to good use for the benefit of society.

Full Article

Convergence in the field of Information and Communication Technologies, ICT, sector has been debated for many years. It has challenged providers of services and is now challenging governments and regulators. By convergence we are focusing on the merging of a number of industries and services namely voice and data telecommunications, radio communications, broadcasting and Internet with all its associated array of software applications and terminals. The drive for convergence has largely been by incumbent operators. They are all striving to reduce costs and seek new service opportunities to offset their loss of market share and falling traditional revenues brought about due to the liberalisation of their markets. Further convergence has been supported by new entrants seeking competitive advantage often using ‘disruptive technology’. Convergence is resulting in transitioning the traditional telecommunications sector into a fully fledged ICT sector. ICT is an ever increasingly important part of the global economy. In particular, an effective ICT sector is of significant importance in the Gulf region. Most of the regional economies face a necessity to diversify themselves by decreasing dependency on income from scarce natural resources and by using the prosperity achieved in order to guarantee continuous long-term well-being for their citizens. This need is apparently recognised by most governments in the Gulf. It is evidenced by fast spreading economic development initiatives and the supporting initiatives in the liberalisation of the telecommunications sectors across the region. This is the context in which governments in the region are developing their national policy and strategies for the Information and Communications Technologies sector with the view to support economic growth. The main objective of a converged policy and strategy is to ensure that development of the ICT sector fosters economic development and supports national competition in world markets. It is also essential to ensure that all citizens have a fair opportunity to share benefits of economic prosperity. A core enabler of success is the universal availability to all citizens of competitive broadband services. A converged national ICT policy and strategy should aim to support: 1. creating a hub for ICT services provided on a regional and even global basis; 2. establishing a centre for ICT related research and development as well as market and technological activities; 3. ICT support of the development of other sectors, where the nation already has a lead or is able to gain a lead e.g. in banking and financial sector; and 4. empowering citizens to participate fully in the development of ICT sector in particular, and economic development in general, and to reap benefits of the development. In order to achieve the aims, outlined above, governments should consider the following three main goals of the policy and strategy: 1. Make world class ICT infrastructure available at competitive prices to satisfy the needs of economic development – use ICT as an enabler; 2. Have the ICT sector make an adequate and growing contribution to the economy – use ICT as a contributor; and 3. Enable citizens to share the benefits of the ICT based economy – use ICT to empower citizens. Governments should act as catalysts and as enablers rather than as market players and service providers. They should dispose of their shares of ICT companies. Where feasible, it is important to rely on the market to satisfy needs of public authorities for ICT services through open tenders. Governments should give ICT regulators an appropriate level of independence. An enabling ICT institutional framework requires a ‘national policy champion’ such as, for example, an ICT Council or ICT Ministry. A converged regulator, an ICT regulatory authority is required to regulate all ICT matters including spectrum, but excluding regulation of content. The Ministry of Information or an ICT Media Board expert should be the representative of public interest especially in respect to content. The Nations legislative framework will need to be reviewed e.g. the Telecommunications Law. It is required to establish an appropriate legal framework for broadcasting and other content related services and support cyber security, including enabling fighting cyber-crimes. There needs to be full commitment to the measures of the World Trade Organization (‘WTO’) with regard to telecommunications sector. Governments should require the regulatory authority to remove barriers to entry as well as eliminate opportunities and incentives for anticompetitive behaviour. Encouragement should be given to the development of high-capacity, alternative, international links to global communications networks. A priority should be placed on procuring services, relying on alternative international connectivity, when satisfying government’s needs for Internet connectivity. It is essential that the regulatory authority ensures that a dominant operator effectively provides adequate set of wholesale products with reasonable prices based upon the cost of efficiently providing the services. Every new operator must have equal rights to access public land for deployment of its communications networks and sufficient resources to ensure the effective deployment of alternative networks. Measures are needed to ensure the efficient utilisation of public property by all competitors, including facilitation of joint construction of networks as well as sharing of physical facilities constructed. Other operators of public infrastructure (electricity, water, roads etc) must be required to share their infrastructure with telecommunications service providers. There should be a policy to maximise the availability of the radio spectrum for commercial economic development. The regulatory authority should open the spectrum to all possible uses and maximising economic efficiency in its use. The regulatory authority should coordinate all the authorities involved in spectrum management and usage, including defence and security authorities, in order to achieve consistent spectrum management. A comprehensive national frequency plan should be prepared and constantly updated. Computerising governmental services and making them accessible via ubiquitous broadband connectivity cannot be overemphasised. Public authorities and civil servants should be trained to routinely employ ICTs to improve the functioning of public administration and services. Governments need to develop regulatory competence in ICT and establish relevant regulatory training programmes. ICTs and regional development ICTs have a special role to play in the social and economic development of the region. A special facility should be established within the framework of an economic development agency to assist ICT investors. There should be a special programme to help entrepreneurs develop their ICT related businesses. Fostering the establishment of ICT community centres that provide communication services and subsidised basic ICT training to low income people should be among the programme’s priorities. An e-Government programme designed to meet the public service needs of the low income population should be rolled out. Investment in communications centres can fill the gaps of universal accessibility to basic ICT services and products, in a framework of the general social assistance policy. A general legal framework for consumer protection – including consumer awareness campaigns – is needed. ICT development and security A national ICT hub e.g. within the framework of a science and technology park and a council for ICT studies and research will assist the use of ICT. The regulatory framework for the importation of electronic equipment should be simple, transparent and proportionate. The legal and regulatory framework for governing the allocation, assignment and usage of radio spectrum should be sufficiently flexible to enable research and development (R&D) and piloting activities. The development of local content – content that meets local linguistic, cultural and practical needs – is imperative. Government should support private sector led content development by showcasing achievements via e-Content award competitions and providing financial facilities, granted in a competitive manner, aimed at fostering development of innovative content and services. A comprehensive legislative framework for data protection with mechanisms for effective enforcement is needed, as is a national Computer Emergency Response Team/Cyber-Security Incident Response Team (CERT/CSIRT). Convergence is a reality today, but regulators still have a long way to go to effectively deal with the challenges it poses. National policy and structures will have to change for any nation to fully take advantage of convergence and to support economic growth. To achieve this, a ‘national champion’ is required to develop a plan with clear timelines, targets and bodies responsible. This ‘champion’ of ICT must have sufficient authority and prestige to efficiently coordinate the implementation of the plan. The champion must be answerable to the government and submit periodic progress reports. The planning and execution to implement the government’s policy and strategy require mechanisms to assess the effectiveness of ongoing activities and those being implemented and to integrate them into the overall programme in a coherent manner. The success of a converged ICT policy can be measured by the rollout, take up and universalisation of broadband communications via fixed and wireless networks. The broadband pipes – the electronic highways for converged services – are the true pathways to economic and social growth and national development.

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