Telecommunication has evolved from wireline technology to mobile communication and is now spearheading towards bigger pastures of convergence and Next Generation Networks (NGN). Convergence is harbinger of colossal change.
NGN will change the face of consumer communications and network computing. As data and voice networks converge in a single network with the potential of streaming rich media as well, the NGN will become the standard infrastructure for the next 10 to 20 years.
Telecommunication Regulators are busy connecting customers with services, services with Networks and Networks with each other. The interconnection shall allow point to point, any to any communications as well as multimedia transfer capability across networks. Convergence is not possible without human interconnectivity innovations. Interconnectivity brings people together. Inter dependency of networks keep the regulator, on their toes to facilitate interconnection between networks, thus promoting competition and ensuring a level playing field. Convergence is pushing the IT sector towards a renewed fever of Mergers and Acquisitions.
For convergence to take place in telecom network regulators should maximise their efforts to create awareness among people by holding Workshops, Seminars and training programs. Operators are little shy to come forward because of high price of license and spectrum fee and expensive 3G phones. Massive 2G roll out commitment and more reliance on SMS and voice are other pacifiers. However regulators should maximize ability of all citizens to use ICT's. Creation of a knowledge based society, reduction in cost through the use of better technology and better infrastructure, simplification of business processes and improvement in quality of service are other landmarks to be covered.
Broadband capabilities will increase the potential for generating content that will be relevant, meaningful and understandable to communities. The key to sustainable network services is demand. And the key to demand is providing useful, culturally sustaining content, in local languages, about local circumstances as well as global realities.
3G, 4G, WIMAX, NGN will not come alone, they are bound to bring host of problems in their wake like VOIP, Licensing and tariff issues. Along this period of mounting change regulator has to co exist with daunting courage to resolve the most problematic interconnect issues for smooth flow of contents across networks. Together with regulators, industry will be compelled to aggressively pursue infrastructure improvement, business efficiencies, deregulation and market rationalisation.
VOIP IN NGN VALUE CHAIN One of the most explosive new arena is Voice over IP. VOIP does not simply mean "voice". VOIP technology also enables video telephony and data collaboration: services that were either non-existent or expensive to use with older access technologies. A key advantage of IP enabled services provide to opportunity bundle these services, to run multiple applications simultaneously and after new user friendly features such as presence and profile.
The Internet is a conceptual creation consisting of protocols and procedures, which are then used by the constituent networks to interconnect. IP-based NGNs represent the "marriage" of the Public Switched Telephone Network (PSTN) with the world of the Internet.
NGN has more defined separation between the transport (connectivity) portion of the network and the services that run on top of that transport. Voice over Internet, holds a key place in NGN value chain. A lot of services cannot be offered unless voice over Internet is allowed under proper regulation.
NGN TELEPHONY ISSUES Past investments and decisions of current competitors in the provision of network facilities and services, regulatory and public policy decisions influence the competitive environment in the telecommunications market and thus the pace of development in achieving the goal of long term revolution. Further costs and prices of alternative network technologies and services also affect the pace of development. Convergence provides unified user experience with services and application available across multiple access technologies and devices in support of an increasingly mobile communication environment. For the 1st time in the history of mankind, humans are experiencing single service offering like mobile/broadband roaming, unified messaging. Voice, data, video, entertainment and information on their handsets. Traditional media has become personalised and interactive. Following issues are identified in obtaining Next Generation Networks.
POLICY ISSUES IP Telephony has several characteristics and capabilities which are quite different from conventional circuit switching in many ways. Implementation of voice services over NGN platform means transforming whole economic and competitive dynamics of telecommunications, in fact, that of entire electronic communications sector. IP Telephony is widely labelled as disruptive technology.
IP Telephony is seen as a major threat to incumbent operator because it undercuts its domestic and international long distance rates and radically reduces the revenues. Strict regulation to protect the revenues of established operators through prohibition of IP Telephony may harm the development of the sector in the longer term.
IP Telephony Policy cannot be considered separately from the most basic issues associated with overall policy on telecommunications licensing and the fundamental objectives of national telecommunications policy and planning.
The impact of lower prices and innovative features enabled by IP Telephony may benefit users directly and help increase the number of users and their volume and types of usage. Policy decisions, under the circumstances should be based on trend data and analyses of different future market scenarios and the effect of alternative regulation, positive or adverse, on the overall market structure.
Enhanced competition may lead to availability of innovative, less expensive services in the interest of users, however, regulation also needs to ensure consumer protection and take social concerns into account, including how to achieve objectives such as universal service access and quality-of-service.
REGULATORY ISSUES Regulation should guarantee reasonable regulatory certainty for investors to recover their investment. The period to realise the investment is getting increasingly shorter in the face of technological development whereas incumbent with historic heavy investments, spread over a period of time, needs to be protected.
The opposing objectives make the regulator walk a tight rope where a balance needs to be struck between protecting the incumbent and encouraging new investment in less expensive and more powerful technologies that benefit users.
However more and more regulators around the world are moving towards minimum regulation to encourage market entry or the creation of innovative new services. Thus regulators have adopted "light-touch" regulation particularly for newer technologies, so that suppliers are encouraged to develop creative technical solutions.
Measures to protect the incumbent operator may be based on specific social policies, such as extending universal service. Regulatory approach needs to weigh the impact of short and long-term policy and regulatory approaches from the end user perspective and potential market entrants as also from the view point of the incumbent operator.
LICENSING ISSUES Most of the issues confronting regulators in are similar to circuit switched network, they have been grappling with for a long time. However the characteristics and capabilities of IP Telephony create a very different context for their resolution. Some of the issues different from conventional switching are identified here:
i) What are the rights and obligations of IP Telephony Licensee?
ii) Should the IP Telephony provider be obligated to provide access to emergency services to its users and contributes towards universal service obligation or not.
iii) Is the IP Telephony provider required to enter into interconnect agreement or not and models thereof, facility based or otherwise
iv) Issues related to IP Telephony services such as, availability, capabilities, QOS, nomadicity, access to E.164 numbers, costs, number portability, call routing etc.
v) Application of Competition Law to IP Telephony, eg regarding the right (or not) of existing network operators (fixed and mobile) to block IP Telephony calls over their facilities.
vi) Spam over IP Telephony (junk mail in voice form), Communication Security ie user authentication, confidentiality, access control, data integrity, privacy, national security etc.
vii) Migration from TDM based infrastructures and Networks (PSTN) to IP-enabled networks. Mobile operators are also in the wake of migrating their networks to NGN, aiming at taking advantage of packet based services delivery through broadband wireless such as 3G, wireless LAN, WiMax, Wi-Fi, Fixed mobile convergence and the like, while driving down operational expenditures. (OPEX)
Due to convergence and the IP based capabilities, IT companies are reshaping their business models to offer bundled services (triple play) either through strategic partnerships or as stand alone eg media companies entering the voice market, Telcos to compete in the media business.
INTER CONNECTION ISSUES Interconnection regulation aims at ensuring a level playing field for all competitors through the development of fair competition that ultimately fosters investment and innovations benefiting the consumers.
The opportunity costs of not developing an appropriate policy and regulatory framework are high and globally evidenced in what has been coined as the digital divide. Countries that are unable to adopt to the challenges posed by global technological and economic trends are increasingly marginalised.
IP technologies and their enabled NGN networks are rather new and require time to master and to define the relevant regulatory framework and the subsequent efficient interconnection rules.
Interconnection guidelines and principles and the access pricing related to PSTN are geographical sensitive, in particular for the POI concerned and are also dependent on the service provided. This is due to the vertical nature of the market structure in the TDM based environment. Interconnection in an NGN environment is less geographic sensitive as NGN carries IP-packets and the connectivity is service neutral.
An extensive economic literature exists about interconnection in the traditional PSTN world. Similarly an emerging literature deals with interconnection in the world of the Internet.
A key challenge will be how to define interconnection regulations that foster NGN-development (securing the ROI for investors) without jeopardising the QoS enjoyed by the consumers as they migrate to NGN. A key challenge will be how to define interconnection regulations that foster NGN-development (securing the ROI for investors) without jeopardising the QoS enjoyed by the consumers as they migrate to NGN.
Interconnection in an NGN environment uses the IP access to allow multimedia communications between different service providers. Connection to the IP-network is through IP-access to servers, no matter which access modality is used (fixed, mobile, computer) and not to any dedicated network.
Open standards for protocols and interface are thereby required to ensure interoperability between networks and applications of different sources.
A number of other regulators, especially in Europe and the Far East, are evaluating the impact of NGN transition for their telecom sectors and for the wider economy. Of these, Ofcom (UK) is by far the most advanced in its thinking followed to some extent by the regulators in Singapore and Netherlands.
The other regulators are in the process of concluding their consultations on the subject and are pushing industry led initiatives to regulate the transition to NGNs. Regulators seem to be similar in their thought process on regulating NGNs and on creating policies to aid its transition.
(The writer is Member (Finance) Pakistan Telecommunication Authority)
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