The OECD has recently unclassified and published a set of documents with interest from the regulatory viewpoint.
Universal Service
The document “Fixed-Mobile Convergence: Market Developments and Policy Issues”[1] (dated 23/03/07) points out the evolution towards FMC, based on the adoption of NGN and on sound economical foundations (e.g. generating new revenues; reducing churn and adding value through bundling; lowering maintenance costs and reconsidering business strategy - namely, from the perspective of fixed operators, to defend against mobile substitution or, from the perspective of mobile operators, to persuade users of a fixed line to “cut the cord”).
Among the regulatory and policy issues raised in the document (such as the need to rethink the concept of technological neutrality, to modify numbering policies and to reassess portability of geographic numbers from fixed to mobile networks), due importance should be conceded to the OECD statement that “the development of FMC may also require that mobile operators participate in universal service obligations by paying into universal service funds but also benefiting from these funds as USO providers”.
Naturally, this recent OECD position must be seen also considering the more controversial document, published in 18/04/06, “Rethinking Universal Service For a Next Generation Network Environment”[2], where relevant issues, are thoroughly discussed, such as the:
(a) sustainability of US during the transition towards NGN;
(b) services to be included in the US in a NGN scenario – where a complex relation between equity, efficiency and cost effectiveness must be achieved in order to minimize the risk of a Digital Divide (the document seems to favour “targeted programmes” such as “low user schemes” in the UK or the plan for retied people and pensioners in Portugal);
(c) quality of service levels associated with VoIP, including reliable access to emergency services, jitter, virus attacks, security, etc;
Universal Service
The document “Fixed-Mobile Convergence: Market Developments and Policy Issues”[1] (dated 23/03/07) points out the evolution towards FMC, based on the adoption of NGN and on sound economical foundations (e.g. generating new revenues; reducing churn and adding value through bundling; lowering maintenance costs and reconsidering business strategy - namely, from the perspective of fixed operators, to defend against mobile substitution or, from the perspective of mobile operators, to persuade users of a fixed line to “cut the cord”).
Among the regulatory and policy issues raised in the document (such as the need to rethink the concept of technological neutrality, to modify numbering policies and to reassess portability of geographic numbers from fixed to mobile networks), due importance should be conceded to the OECD statement that “the development of FMC may also require that mobile operators participate in universal service obligations by paying into universal service funds but also benefiting from these funds as USO providers”.
Naturally, this recent OECD position must be seen also considering the more controversial document, published in 18/04/06, “Rethinking Universal Service For a Next Generation Network Environment”[2], where relevant issues, are thoroughly discussed, such as the:
(a) sustainability of US during the transition towards NGN;
(b) services to be included in the US in a NGN scenario – where a complex relation between equity, efficiency and cost effectiveness must be achieved in order to minimize the risk of a Digital Divide (the document seems to favour “targeted programmes” such as “low user schemes” in the UK or the plan for retied people and pensioners in Portugal);
(c) quality of service levels associated with VoIP, including reliable access to emergency services, jitter, virus attacks, security, etc;
(d) merits of the funding arrangements, at the light of the principles of economic efficiency, equity, competitive neutrality, technology neutrality, certainty, transparency and cost effectiveness.
The combined re-reading of these documents ought not to be disregarded as a “warm up” exercise for the forthcoming Universal Service Green Book.
Broadband
The OECD released yesterday its broadband statistics to December 2006[3]. Some of the main findings:
(a) “Over the past year, the number of broadband subscribers in the OECD increased 26% from 157 million in December 2005 to 197 million in December 2006. This growth increased broadband penetration rates in the OECD from 13.5 in December 2005 to 16.9 subscriptions per 100 inhabitants one year later”;
(b) European countries have continued their advance with high broadband penetration rates - In Portugal the penetration has grown 20% in 2006. In December 2006, eight countries (Denmark, the Netherlands, Iceland, Korea, Switzerland, Finland, Norway and Sweden) led the OECD in broadband penetration, each with at least 26 subscribers per 100 inhabitants - Denmark and the Netherlands are the first two countries in the OECD to surpass 30 subscribers per 100 inhabitants;
(c) Fibre-to-the-home (FTTH) and Fibre-to-the-building (FTTB) subscriptions now comprise nearly 7% of all broadband connections in the OECD and the percentage is growing. Korea and Japan each have more than 6 fibre-based broadband subscribers per 100 inhabitants;
(d) DSL continues to be the leading platform in 28 OECD countries. Cable modem subscribers outnumber DSL in Canada and the United States;
(e) The breakdown of broadband technologies in December 2006 is as follows: DSL: 62%;Cable modem: 29%; FTTH/FTTB : 7%; Other (e.g. satellite, fixed wireless, powerline communication): 2%
Another document, “Internet Traffic Prioritisation: An Overview” [4] dated 06/04/07, attempts to provide background for national debates regarding policy and regulatory issues related with traffic prioritisation. According to the OECD, these debates should not focus on whether packet structuring for QoS should be allowed but rather “on how consumers should be safeguarded from anti-competitive behaviour, whether consumers maintain their ability to choose the services they want and how much control the end user may have over determining which packets receive better transmission”. The extent to which anti-competitive behaviour applicable to internet traffic prioritisation is a real threat is, nevertheless arguable – the document recognizes some would state that this sort of analysis is a solution in search of a problem.
Critical Infrastructure Protection
The document “The Development of Policies for the Protection of Critical Information Infrastructures”[5], dated 06/02/07, seeks to offer an analysis of the Critical Information Infrastructure policies in the UK, USA, Canada and Korea, focusing on the main drivers and challenges, risk assessment methodologies, models for public-private information sharing and cross-border collaboration.
One of the most interesting conclusions is that commonalities on risk management between these countries (that share effectively information at national and international level) include an effective national risk management: (a) similar strategy “with a set of policies and objectives reaching from the highest levels of government to individual owners and operators of critical information infrastructure”; (b) framework, with “the detailed organisation, tools and monitoring mechanisms required to implement the policy at every level”.
China
For those interested in looking beyond Europe (see yesterday’s post), the paper “Is China The New Centre For Offshoring of IT and ICT-Enabled Services?)[6], dated 29/03/07, suggests that China has the adequate economic conditions to grow in terms of receiving offshoring IT and ICT-enabled services, including highly skilled labour supply, ICT infrastructure and ability to deal with transnational firms. On the other hand, “it has not yet developed the specialised firms and human resources, including foreign language resources, or the stock of inward services investment to supply these services globally”.
[1] http://www.oecd.org/dataoecd/20/26/38309911.pdf
[2] http://www.oecd.org/dataoecd/59/48/36503873.pdf
[3]http://www.oecd.org/document/7/0,2340,en_2649_34225_38446855_1_1_1_1,00.html
[4] http://www.oecd.org/dataoecd/43/63/38405781.pdf
