international telecommunication union partners in transition 22 nd annual telecommunications...

InternationalTelecommunicationUnion

Partners in Transition22nd Annual Telecommunications Conference and Trade Exhibition,

CANTOPunta Cana, Dominican Republic

19 June 2006

Roberto BloisDeputy Secretary-General, ITU


Agenda

1. Partnership in World Summit on the Information Society (WSIS)

2. Drivers of the telecom industry3. Partners in Transition towards IP-

enabled NGN4. Conclusions

Helping the world communicate


1.1 World Summit on the Information Society (WSIS)

Geneva Phase: December 200311,000 participants 41 Heads of State1.Geneva Declaration of Principles2.Geneva Plan of ActionTunis Phase: November 200525,000 participants 47 Heads of State3.Tunis Commitment4.Tunis Agenda for the Information Society



1.2 Main WSIS Outcomes• Emphasized multi-stakeholder partnerships for progress; • Est. Internet Governance Forum;• United Nations Group for the IS;• Creation of Digital Solidarity Fund;• Framework for implementation assigning clear responsibilities;• And more…



1.3 Internet Governance Forum (IGF)

• First meeting in Athens, Greece: 30 Oct – 2 November 2006 • Annual meeting: not a decision-making

forum• (2007: Brazil, 2008: India)

• Information-sharing event with development focus

• See www.intgovforum.org

• IGF Advisory Group (AG) and representatives of IGO’s (e.g., ITU, OECD, UNESCO, World Bank) developing meeting agenda

http://www.intgovforum.org/


1.4 Athens IGF Agenda Themes• Openness:

• Free flow of information, idea and access to knowledge.

• Security:• Building trust in an online environment;• Protecting users from spam, phishing, and

viruses;• Maintain security while protecting privacy.

• Diversity:• Promoting multilingualism including IDNs

and promoting local content;• Respecting geographical diversity.

• Access:• Internet connectivity: Cost and Policy


2. Drivers in the telecom industry1. Competition 2. Cost & Revenues 3. Growth in Customers 4. Technological Innovation – the

transition to IP-enabled NGN


Growth in telephony

0

500

1'000

1'500

2'000

2'500

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Fixed linesCellular subscribers

2.14 billion mobile

1.28 billion fixed (e)

Evolution from multiple separate networks(each optimized for one service) to a

unified IP-based multi-service network

Telephony

Internet

Television

Multimedia Services

Telephony

Internet

Television

…

IP-based network

Control layer

Worldwide Competition in Basic Services, 2006

49 5041

18

39

51 50

59

82

61

0

10

20

30

40

50

60

70

80

90

Africa Caribbean Asia-Pacific Europe World

MonopolyCompetition

$34.64

$120.21

$31.26$22.38$27.01

$68.86

0

20

40

60

80

100

120

140

Internet access Broadband entrypackage

Broadband (USD per100 kbps)

Pric

e (U

SD

)

2003

2005

Broadband (US$ per 100 kbps)-14% p.a.

Cost of 20 hours' Internet -11% p.a

Entry-level broadband package -21% p.a.


2.1 Drivers - Competition


Worldwide Competition in Basic Services, 2006

49 50

39 41

18

39

51 50

61 59

82

61

0

10

20

30

40

50

60

70

80

90

Africa Caribbean Americas Asia-Pacific

Europe World

MonopolyCompetition

Source: ITU World Telecommunication Development Report 2006.


2.2 Competition in the Caribbean, 2006


Caribbean Operators where data are available, 2006

50

70

90

50

30

10

0102030405060708090

100

Fixed telephony Cellular Internet

CompetitionMonopoly

World Averages, 2006

61

8793

39

137

0102030405060708090

100

Fixed telephony Cellular Internet

CompetitionMonopoly


2.3 Drivers – Cost Worldwide


$16.81

$37.44

$60.74

$34.28

$28.20

$12.94

0

10

20

30

40

50

60

70C

ost (

US

D)

20032005

mobile basket

20 hours' Internet access

broadband($/100 kbps)-40%

Average cost of ICT worldwide, 2003-2005


2.4 Drivers – Cost of Mobile in the Caribbean, 2005


Cost of OECD mobile low-user basket, 2005

$8.78

$11.82$13.31

$14.75$16.41

0

2

4

6

8

10

12

14

16

18

Asia Caribbean Africa Americas Europe

Cos

t (U

SD

)


2.5 Drivers - Cost of Broadband in the Caribbean, 2006


Broadband, Price per 100 kbps (USD), 2006

$5.24$12.10 $13.36

$68.55

01020

3040506070

8090

100

Europe Americas Caribbean Asia Africa

Pri

ce (U

SD

)

$199


2.6 Drivers – Internet access in the Caribbean, 2003-2005


$34.64

$120.21

$31.26$22.38$27.01

$68.86

0

20

40

60

80

100

120

140

Internet access Broadband entrypackage

Broadband (USD per100 kbps)

Pric

e (U

SD

)

2003

2005

Broadband (US$ per 100 kbps)-14% p.a.

Cost of 20 hours' Internet -11% p.a

Entry-level broadband package -21% p.a.


2.7 Drivers - Growth in CustomersGrowth in telephony

0

500

1'000

1'500

2'000

2'500

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Fixed linesCellular subscribers

2.14 billion mobile

1.28 billion fixed (e)


2.8 Drivers – Technological Innovation


Evolution from multiple separate networks(each optimized for one service) to a

unified IP-based multi-service network

Telephony

Internet

Television

Multimedia Services

Telephony

Internet

Television

…

IP-based network

Control layer

Source: ITU workshop on “What Rules for IP-enabled NGN?”, adapted from Christian Wey.


Transition towards NGN: Definition

• A Next Generation Network (NGN) is a packet-based network able to provide services and make use of multiple broadband, QoS-enabled transport technologies and in which service-related functions are independent from underlying transport-related technologies. It offers unrestricted access by users to different service providers. It supports generalized mobility which will allow consistent and ubiquitous provision of services to users.

ITU Study Group 13, 2004.



Transition to NGN


•On NGN technical standards, ITU fully engaged

•But convergence and transition to NGN implies new challenges for policy-makers and regulators

• Capital markets looking for regulatory certainty!

•ITU workshop in March 2006 initiated international dialogue:

“thought-leading” background papers sharing of national experiences and approaches assistance in capacity-building with developing economies in transitioning to this new paradigm

See www.itu.int/osg/spu/ngn/


Main findings


Old World(PSTN telecom)

New World(IP-based Internet)

Circuit-switched Packet-based, based on IPInterconnection P2P peering arrangementsCapacity-based Quality of Service class (best effort)

Cost orientation on marginal cost Bundled offers; marginal costs near zero

Calling Party’s Network Pays Unclear - Bill and Keep?

Price caps Price squeezes

Key issues – asymmetric regulation (numbers, universal & emergency service)

Unlicensed bands, spectrum trading

Network-centric control & intelligence Edge-centric intelligent nodes at edge

Source: ITU, adapted from discussions during the ITU workshop, “What Rules for IP-enabled NGN?”


Arguments for regulatory forbearance

• Incentives for massive investments required, so “national regulatory moratoria” are required;

• too early to know whether interconnection will be open access or wholesale mandated.


Arguments for re-monopolisation?• Carriers may rapidly vertically integrate

services and bottlenecks in access and control may emerge;

• regulate non-replicable assets only.

BUT• Shake-up may be so profound,

incumbents lose Significant Market Power and be forced into strategic alliances with content providers


Conclusions• NGN radically transform business models

– threat, as well as an opportunity• Risk of re-monopolization, necessitating

regulation of bottlenecks• Alternatively, incumbents may lose

Significant Management Power, as they are forced to cooperate with other players

• Can only deal with this radical industry shake-up together, as partners in transition


International Telecommunication

Union

Roberto BloisDeputy Secretary-General

ITUEmail: [email protected]

international telecommunication union partners in transition 22 nd annual telecommunications...

Documents