4.1 What is Convergence?

There is no universal definition of convergence, although generally it is understood to mean the ability of different networks to carry similar kinds of services (e.g., voice over Internet Protocol (IP) or over circuit switched networks, video over cable television or Asynchronous Digital Subscriber Line (ADSL) or, alternatively, the ability to provide a range of services over a single network, such as the so-called “triple play.” Box 4-1 summarizes some of the issues that regulators should consider with regard to convergence.

Convergence is accelerating as existing networks are modified to offer new services (e.g., upgrade of telephone networks to offer ADSL, alteration of electric power networks to offer broadband services, and the modification of cable networks to offer interactive services). Convergence is also possible with wireless broadband technologies. As a result, different network infrastructures can today provide a plethora of services (Table 4-1). Cable television providers can offer consumers voice, Internet access, and broadcast services over the same network as one bundled package of services, and for one monthly price. Likewise, a mobile service provider may be able to offer a subscriber data and video services, as well as voice services, and digital television (DTV) providers are offering interactive services.

Table 4-1: Developing viable business models with convergence

Source: Telecommunications Management Group, Inc.

The combination of services over the same platform is challenging common perceptions about the best means to license and regulate providers in the information and communications technology (ICT) sector. Traditionally, regulatory frameworks were designed for an era when clear functional differences existed between services and infrastructure, but these regulations are increasingly inadequate for dealing with today’s world.

Policy-makers and regulators are responding to the challenges presented by the ICT sector in a variety of ways. First, there has been a shift towards an equal or technology-neutral regulatory treatment of different information and communications infrastructure. For example, the European Union (EU), India, and Kenya1 have introduced, or are in the process of introducing, legal frameworks and regulations to regulate aspects of convergence through a flexible and a technology neutrality approach.

Second, governments such as Malaysia, Singapore, and the United Kingdom, are modifying the structure of regulatory authorities by providing them with the authority to regulate the telecommunications, broadcasting, and information technology sectors. Finally, governments are drafting and implementing new laws and regulations to create the necessary legal enabling framework to support an ICT sector. These laws and regulations deal with such issues as intellectual property, content, data protection, security, and computer crime.

Another approach to convergence is to accommodate it within the existing legal and regulatory framework. This is possible in countries where there are no barriers to market entry or restrictions on the type of service offering. Although operators can, and do, offer multiple services over multiple platforms in fully competitive markets, it is often a cumbersome process requiring multiple licences and regulatory oversight by different institutions.

ENDNOTES

1 The Communications Commission of Kenya announced in 2004 its intention to adopt gradually a technology-neutral and unified licensing framework. See public consultation on intention to merge licence published on 21 September 2005 at http://www.cck.go.ke.