Industry requirements for a regulatory environment for Next Generation Networks

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Industry requirements for a regulatory
environment for Next Generation Networks
Wolfgang Reichl, Telekom Austria, Chair of WG on NGN at
European Telecommunications Platform, Brussels, Belgium
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ETP
The European Telecommunications Platform (ETP) is a consultative body
which was formed in Brussels on 4th February 1998, following the opening of
the European telecommunications market on 1st January of that year.
It combines the Open Network Provision Co-ordination and Consultation
Platform (ONP-CCP), founded in 1991, and the European Interconnect Forum
(EIF), which during the run-up to liberalisation had both been advising the
European Commission as representatives of the telecommunications industry.
The ETP deals with the needs of the European telecommunications market
from the point of view of industry. Its remit includes: the European
regulatory framework, its implementation, the converging communications
sector, and the global information society.
What are its goals?

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promote self-regulation by the industry
encourage the ongoing development of competition
clarify operational and strategic business issues
www.etp-online.org
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ETP Members
Agoria ICT
Amena
Arcome
BITKOM
BT
Cegetel
Cesky Telecom
Cisco Systems
Cullen International
Deutsche Telekom
ECCA
ERA
Ericsson
ETNO
FiCOM
Finnet
France Telecom
Global Crossing
Interconnect Communications
KPN
Lucent Technologies
Magyar Telecom
Nokia
Nortel
Omnitel
ONE
OTE
PT Luxemburg
Siemens
Slovak Telecom
Swisscom
TDC
Telekom Italia
Telecom Italia Mobile
Telefonica
Telekom Austria
Telekom Slovenije
Telenor
Tele.ring
TeliaSonera
14. November 32005
Report on NGN - released 20 January 2006
Real world implementations of NGN
• Next Generation Core
• Next Generation Access
• Next Generation Service Control
Regulatory implications of NGN evolution
High level requirements
for a positive environment for NGNs
focus of this
talk
the report can be dowloaded from www.etp-online.org
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Next Generation Networks
Applications
Next Generation
Service Control
Customer
Premesis
Equipment
Next Generation
Access
Next Generation
Core
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Core, Access, Services
The Next Generation Core
The next generation core network is a single converged fixed network, which can carry voice
and data. The network technology of choice will be IP/MPLS and all traffic is transported as IP.
This core networks evolves from a complex environment of different boxes in todays core
networks. The evolution to a next generation core network promises significant savings in the
long run and a stable platform for converged services.
The Next Generation Access
The next generation access is a large digital bitpipe. The next generation access is service
independent and allows triple play (TV broadcast, high speed internet access and telephony).
There will not be a single platform to deliver next generation access. Platform competition is
expected between copper lines, cable networks, mobile networks as well as satellite and fibre
access.
The Next Generation Service Control
Todays service control is service specific. In a next generation network rapid service
development and delivery is paramount. The next generation service control will provide a
toolbox for operators, where converged service can be brought to market flexibly and quickly.
Certain challenges arise regarding interoperability of services and service components.
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Existing legislation and NGNs
Policy makers should carefully evaluate if
existing legislation is suited for NGNs, e.g.
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
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legal intercept
emergency services
universal service
Disclaimer:
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ETP‘s NGN Paper has the intent to highlight challenges in applying
regulatory and legislative measures in NGNs
Does not attempt thorough investigation
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Regulatory Implications of NGNs
New technologies raise policy issues
Transition phase: existing regulatory framework
needs to be evaluated with regard to


Changing technology
Changing market structure
Vision: one network – many services -> underlines
necessity for technology neutral approach.
Reflection on boundaries between networks and
services is needed.
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Today: two sets of regulation
Regulation imposed on everyone
Regulation applied in case of significant
market power
the first set of regulation:
 Legal requirements
 Security requirements
 Consumer protection
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Reacting to concerns
New technological possibilities lead to
additional privacy concerns
Legislators may be tempted to intervene
Challenge for industry to respond to
concerns
 Conduct educated and informed discussion
 Leave it to industry to give consumers real
choice and protection incl. data security and
opt-out privacy protection!
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Economic regulation
Technologies for NGNs are mature and available but
business models aren‘t
Market analysis/Art. 7 procedures: process still not
completed within various EU25 Member States
Today‘s 18 markets and SMP remedies are very much
connected to legacy infrastructure and services
Not evident whether NGNs will fit into existing markets
or will generate new unregulated markets.
NGN itself is not a market! NGNs lead to new markets
and changing market structures.
General competition law may be sufficient to deal with
NGNs!
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NGN in the UK
BT has made plans to introduce a NGN
over the next 5 years
BT has made formal commitments to
Ofcom such as:
 grant access to other network operators
 Not make any network design decisions that
would prevent supply of network access
 Set charges based on costs (for most efficient
network that could reasonably be built)
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High level requirements…
… for a positive regulatory environment for NGNs:
For Europe’s information society and media policies, the
Commission proposes in I2010
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the completion of a Single European Information Space which
promotes an open and competitive internal market for
information society and media;
strengthening Innovation and Investment in ICT research to
promote growth and more and better jobs;
achieving an Inclusive European Information Society that
promotes growth and jobs in a manner that is consistent with
sustainable development and that prioritizes better public
services and quality of life.
NGNs will contribute significantly to these goals!
Policy has to be decoupled from technology!
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The new regulatory environment ...
should be based on technology-neutral and provider-neutral
regulatory criteria
Regulatory asymmetry leads to competitive asymmetry and
creates the incentive and the opportunity for artificial
competition, which is not based on market demands. It is of
utmost importance to find a proper and workable definition of
technological neutrality.
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The new regulatory environment ...
must be based on legal principles drawn largely from competition
law
Current and likely marketplace developments demand a statutory
structure, which makes regulation dependent upon a finding of lack
of effective competition. Although reliance on competition law is a
long term goal, ex-ante regulation is likely to be needed for some
time if some foreclosure of markets occur, which can not be solved
with other instruments.
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The new regulatory environment ...
non-economic regulation should be hands-off regulation
The societal regulatory regime ought to pursue a regulatory hands-off approach with as light a touch as possible. This hands-off approach should not only
apply to the European level but also to the national level. However, harmonisation on a European level (e.g. regarding EMC or terminal equipment) remains
necessary to gain the benefits from a European market and to achieve user protection.
The societal regulatory regime ought to pursue a regulatory handsoff approach with as light a touch as possible. This hands-off
approach should not only apply to the European level but also to
the national level. However, harmonisation on a European level
(e.g. regarding EMC or terminal equipment) remains necessary to
gain the benefits from a European market and to achieve user
protection.
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The new regulatory environment ...
economic regulation (if required) should focus on enduring
bottlenecks
Although it would be desirable eventually to base economic
regulation entirely on competition law, it might be necessary to
deal with network bottlenecks while they still exist. These
bottlenecks are likely but not exclusively to be found in the access
network.
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The new regulatory environment ...
should allow for innovation and investment
There needs to be a favourable regulatory environment for
investment and innovation in Next Generation Networks. This is a
necessary precondition for the achievement of the goals set in
i2010, which was announced by the Commission on 1 June, 2005. It
promotes an open and competitive digital economy and emphasises
ICT as a driver of inclusion and quality of life. NGN can become a
means to achieve the policy goals of the Commission.
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The new regulatory environment ...
should provide legal certainty
For investment in telecommunications legal certainty is a necessary
prerequisite. The current regulatory framework does not provide
this certainty (e.g. the definitions of PATS and ECS do not reflect
some technological evolutions).
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The new regulatory environment ...
should focus on services not on technology
Every asymmetry in technology triggered by regulation can
potentially distort the market. Therefore technology decisions
should be left to the market. Regulators should not interfere by
promoting one or the other technology. It is therefore necessary to
define the boundary between technology and service. The Next
Generation Core itself falls out of the regulatory scope. It is the
services that are subject to possible regulation.
Every asymmetry in technology triggered by regulation can potentially distort the market. Therefore technology decisions should be left to the market.
Regulators should not interfere by promoting one or the other technology. It is therefore necessary to define the boundary between technology and
service. The Next Generation Core itself falls out of the regulatory scope. It is the services that are subject to possible regulation.
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The new regulatory environment ...
should avoid fragmentation of markets
A common market allows the competitive provision of services and
products. Fragmentation could endanger the position of the
European industry and operators and has therefore to be avoided.
NGN interconnection will be based on standards voluntarily agreed
upon by industry in standards bodies. That does not imply that
standards need to be imposed.
Every asymmetry in technology triggered by regulation can potentially distort the market. Therefore technology decisions should be left to the market.
Regulators should not interfere by promoting one or the other technology. It is therefore necessary to define the boundary between technology and
service. The Next Generation Core itself falls out of the regulatory scope. It is the services that are subject to possible regulation.
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The new regulatory environment ...
should balance harmonisation and innovation
Harmonisation is certainly necessary to avoid fragmentation and to
allow for interoperability of services. It has however to be
recognized that harmonisation in an early stage could stifle
innovation by favouring a possibly suboptimal solution. Priority
should be given to market forces which will lead to harmonised
solutions at the right time. This is probably different for different
layers. Innovation at service level is much more important.
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The new regulatory environment ...
should address the question of cross-border services
In a next generation network the possibility for cross-border
services exists. It has to be assured that national operators are no
worse off than competitors from abroad. Therefore the EU should
try to accede to agreements with other parts of the world. NGN has
a global focus. That's the reason for global standards.
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Conclusion
The new regulatory environment should rely on
market forces and competition.
Non-economic regulatory goals should be pursued
with as light a regulatory touch as possible.
In that way next generation networks will
significantly contribute to the political goals set
out in i2010.
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THANK YOU!
www.etp-online.org
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