In this sub-section, six general and transversal regulatory issues are discussed:
The aim is to present the latest discussions and developments in the field, setting the agenda for communication regulation in the coming years. However, in order to ‘set the scene’ for these discussions and developments, a brief introduction to the path from the ‘old regulatory regime’ to the ‘new regulatory regime’ is put forward.
With respect to sector specific and/or general competition regulation, the final aim since the beginning of the liberalization of the telecom area has been to reach a situation whereby the area would be regulated by general competition regulation. The final aim may not have been explicit all the while since intermediate aims have dominated the political and economic discourse, such as the creation of competition after a long period of monopoly. This has led to a situation whereby sector specific regulation has been implemented with the purpose of reaching a stage, where it could be lifted again as a result of the establishment of a competitive market. An open question is, however, the extent to which this goal will be reached. Nevertheless, the aim is to move continuously in the direction of creating fair competition on the telecom markets and to lift sector specific regulation when possible.
The aim of technology neutrality is related to the aim of general competition regulation. Where telecom regulation, to a large extent, is network and service specific in the present context, the aim is to reach a situation where the choice of technology solutions is left to the companies in the markets. Technology convergence will facilitate more competition in the telecom markets, as new network and service providers can enter markets that previously were served by specific technology solutions, and will therefore increase the possibilities for going from sector specific to general competition regulation. It will also increase the possibilities for going from a more technology specific regulation towards a more technology neutral regulation. This applies to universal service/access where unified licensing procedures as opposed to technology specific licensing can be implemented to a higher degree. It apples to competition regulation where different technology solutions can be used to service the same communication needs, and to radio frequency regulation where the choice of technology solutions can be left to market players to a greater extent.
The issue of infrastructure vs. service competition is strongly related to the two aforementioned issues and is also closely connected with technology convergence developments. Infrastructure competition has since the beginning of the liberalization of the telecom area been seen as a more sustainable form of competition than service competition, as service competition, in the present situation with one incumbent and dominant operator in most national contexts, implies a dependence of alternative operators on the incumbent. However, infrastructure competition has been difficult to obtain in fixed line areas, as the requirements on investments of alternative operators have been high, and service competition has therefore been used as a substitute or complement to infrastructure competition. Technology convergence enabling use of different infrastructures for a number of different services, however, renders infrastructure competition more realistic. A related issue concerns infrastructure sharing. In developing countries especially but also in other countries, there can be good arguments for allowing infrastructure sharing, which indeed may lead to less infrastructure competition, but also can foster infrastructure construction and increased access.
Regarding cost-based regulation, two important issues are dealt with in the present sub-section. The first issue concerns the development towards basing interconnection prices and end user prices on costs. This has been an important aim since the beginning of liberalization and has been implemented in a large number of countries. However, many developing countries still need to apply more streamlined methods and procedures in their cost calculations. The second issue deals with the broader question of using cost calculations as a basis for technology choices. In the cases where new technologies are cheaper than existing technologies or other technological options, costs should be an important parameter in technology choice and substitution.
Regarding the regulatory set-up and business models, there is presently a greater emphasis on exploring all kinds of organizational models in order to expand connectivity. In the first period of telecom liberalization, focus was mostly on establishing competition and on expanding telecom infrastructures by means of the activities of alternative but traditional telecom operators. However, it has turned out that there are limits to this strategy. Competition in important market segments is still not significant, and especially in the wake of the telecom crisis in the first years of the new century it has been difficult for developing countries to attract new operators to their markets. This is one of the reasons why there is increasing emphasis in the present situation on promoting all kinds of alternative, demand-led and cooperative telecom networks.
Quality of Service (QoS) is an area which has been part of telecom regulation from the very beginning. The issue, nationally, was for many years the service quality that end users could get. Internationally, there was also the question of the quality of services when interconnecting with other national operators in international communication. With the liberalization of the area, the quality of wholesale services has also become an important issue nationally. The main issue approached in the present sub-section is whether the problems related to QoS have changed fundamentally with the transition from a circuit-switched to a packet-switched environment and whether or to what extent the regulatory issues consequently have been altered.