April 20, 2007

AGCOM’s NGN WORKSHOP

Torino, where Italy’s past (embodied in the magnificence of its superb palaces) meets its promising future (anticipated in the aerospatiale and automobile industries), was undoubtedly an appropriate place to discuss the transition from traditional networks to NGN.

The speakers certainly contributed to form a better understanding of the technological, economic, competition and regulatory context associated with the rollout of NGN, in particular concerning the country case studies of the Netherlands, the UK and Italy.

As tentative conclusions of the workshop, one could highlight the following:

(a) migration towards NGN is an evolution, not a revolution - change will happen gradually and require large investments;

(b) NGN will result in high operational cost savings, which distribution has to be carefully considered;

(c) there is no actual evidence that supports the case for “regulatory holidays”, but there is a real need to ensure transparency and predictability of regulatory decisions;

(d) establishing adequate standardisation and interconnection principles and models is paramount;

(e) “horizontal” barriers (mainly related with access to ducts and related infrastructure), “vertical” barriers (essentially associated with in-building wire costs) and the cost of equipment, may result in considerable obstacles to the investment of alternative operators;

(f) information about the precise rollout plans and business cases of the operators is scarce, which tends to aggravate the classical information asymmetry problem between regulator and regulated entities;

(g) bundles of services may probably become a standard offer in a NGN scenario;

(h) new NGN supported services require ICT skills from customers, which, in conjunction with the elevated costs of broadband deployment in rural areas, recommends special attention should be given to the “Digital Divide”;

(i) there is not a “one size fits all solution” for Europe – significant differences in terms of obsolescence of the “traditional” networks, length of the local loop and of the sub local loop, distribution of the population, economies of scale and scope, access to ducts conditions, etc – advise that particular attention should be given to specific national conditions, naturally in the framework of a globally European coherent regulatory approach.