Industry regulators need to evolve their roles to becoming developers, not just guardians
Challenges face regulators, operators due the rising data tsunami, which isn’t abating.
INFORMATION and communications technology (ICT) regulators have to re-evaluate their roles and make changes to the way they work if they are to evolve together with the industry, according to a policy maker.
Leong Keng Thai, deputy chief executive officer and director-general for telecoms & post, Infocomm Development Authority (IDA) of Singapore, said the rapid pace of change within the ICT space has forced industry regulators such as the IDA to adapt to become more than merely a regulator.
“The role of a [traditional] regulator is changing as we do more than just regulating competition today,” he told a CEO Perspectives panel at the CommunicAsia 2012 Conference on June 20.
Leong (pic, courtesy of ITU) said many telcos have gone beyond merely providing the transport layer and have moved into distribution, managed services, content provision, and broadcasting, among other services.
Noting that regulators today need to play the developer rather than just the regulator role, Leong said policy makers such as the IDA or the Malaysian Communications and Multimedia Commission (MCMC) will have to make sure that they allow telcos to do this while ensuring the competitive space in the market is maintained.
“You have to create policies to encourage them to go beyond what they traditionally do,” Leong said. “All this is going to be part and parcel of being a larger agency, to go beyond just playing the pure regulator role. I think this is very important if we want the industry to flourish, and if we want our telcos to go beyond just what they are today.”
The panel then discussed what were some of the challenges facing modern regulators such as the IDA, to which Leong listed four.
The first, he said, was the escalating growth of data, particularly that generated by the mobile ecosystem. Noting that mobile data traffic consumed in 2010 amounted to 3.1 petabytes in Singapore alone, Leong said mobile data growth shows no sign of abating and is forecasted to reach a whopping 37 petabytes in 2015.
“Data will grow so fast, so how do we keep up with this growth and at the same time ensure good quality services at acceptable levels? What about spectrum issues and how it will use to support such services?”
The next challenge, Leong noted had to do with workflow and how data is consumed outside the island state. He noted that there needs to be a balance between data protection and companies wanting to provide services and store this data outside the country.
“Such issues could hinder data flowing in and out of a country,” he said. “We want the Googles [of the world] to come to Singapore, but at the same time we want to protect our citizens’ personal data.”
In tandem with this, Leong said the third challenge had to do with security, especially in the wake of globalization. “If we put too much emphasis on security [in the services] that we use, it will become unfriendly for people to use. But at the same time, security needs to be looked into.”
Lastly, Leong said there was a need to increase the competition at the services level as today, the infrastructure is just the transport layer. Noting that innovation begins at the service level, regulators would need look at how to continue to foster innovation at the policy decision making level.
“Some may have good ideas but are unable to innovate because of the lack of money,” he explained. “We must formulate policies to help deal with this.”
Besides the challenges specifically facing regulators, the panel also deliberated on what were the more general impediments to the telco industry at large.
Michael Lai, CEO of Packet One Networks (P1), revealed that data consumption for P1 began at an average of seven gigabytes (GB) per month, rising to 17GB three years later.
P1 went live in August 2008 as Malaysia’s first WiMax operator. To date, it has racked up over 400,000 subscribers and about close to 65% of WiMax coverage in the country, the company claimed. P1 has also recently forayed into providing fiber-to-the-home services via a partnership to use incumbent Telekom Malaysia’s last mile access but demand for this service has been mixed, at best.
Lai (pic, courtesy of amanz.my) said the industry needs to meet this demand but there is a scarcity of spectrum with which to deal with the growth as the world is running out of spectrum. Governments, he suggested, need to get together and plan properly for the future.
“Besides spectrum allocation itself, there is also the issue of whether operators are getting sufficient blocks of operating frequencies,” he said, adding that the this factor determines the speed and quality of service for operators.
Lai, who was part of the CEO Perspectives panel, also acknowledged that in a world experiencing data tsunami, operators need to learn to work together in certain areas while competing with each other at the same time.
Calling this “co-opetition,” Lai said, “We are in a situation which traditional telcos may not be very used to but [nonetheless] will need to learn to collaborate whenever it is required and compete whenever it’s necessary because of the increasing demands on capital expenditure (capex) requirements. Co-opetition will trigger this and regulators have also begun encouraging this.”
Lai also firmly believes that the industry will see more heterogeneous networks, where no one telco can provide services based on just one type of technology.
Operators should leverage on whatever technology – WiMax, Wi-Fi, fiber – that make most sense from a cost perspective in order to make it work for consumers, he said.
Edwin Yapp of Digital News Asia reports from CommunicAsia 2012 in Singapore.
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