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Infrastructure sharing in telecommunications needed to offset investment drought – UN

Infrastructure sharing in telecommunications needed to offset investment drought – UN

Sami Al Basheer
Strategies for sharing among telecommunications and information and communication technology (ICT) providers are needed to offset an investment drought stemming from the deepening global financial crisis, according to a new United Nations report.

“Sharing strategies are increasingly necessary to ensure that operators can deploy their networks at low cost while guaranteeing that consumers have access to affordable services,” UN International Telecommunications Union (ITU) Telecommunication Development Bureau Director Sami Al Basheer said on the release of the agency’s annual report.

“Now, more than ever, sharing strategies make sense as operators are forced to reduce the costs of network deployment as they compete for scarce investment funds. This is a forward-looking perspective in light of the current financial and economic uncertainty.”

Such strategies include sharing civil engineering costs in deploying networks, promoting open access to network support infrastructure (poles, ducts, conduits), essential facilities (submarine cable landing stations and international gateways), and access to radio-frequency spectrum and end-user devices.

The report – Trends in Telecommunication Reform 2008: Six Degrees of Sharing – details a set of regulatory strategies designed to lower the costs of network rollout. It notes that 2008 has been marked by unparalleled numbers of voice and Internet consumers in both the developing and developed world, the result of network growth and expansion.

The “Six Degrees of Sharing” theme was first discussed in Thailand during the ITU’s 2008 Global Symposium for Regulators last March. Few observers could then have anticipated the rough ride that would be in store for financial markets later this year.

Yet, the guidelines announced in March seem almost prophetic in today’s circumstances. Taking a broad and innovative view of sharing, the world’s regulators sought to capture the productivity of global networks and use it to expand the scope of opportunities for service and content providers and, ultimately, consumers.

Developing countries embraced sharing to make more affordable the expansion of ICT networks to rural and under-served areas. Many developed countries are looking at sharing to reduce the cost of rolling out ultra high-speed broadband networks that reach customers’ homes and apartment buildings.

What had been foreseen as ideal strategies to extend broadband network access in developing markets may now be viewed as a prescription for the entire world. If the sources of capital for network investment suffer a temporary drought, policymakers could take steps to make their markets more amenable to the shrinking pool of investment.

Such measures could include lowering investment barriers that inhibit capital flows from one country to another, reducing regulatory barriers (high licence fees or market-entry bans) that represent hostile environments for capital investment and market growth, and sharing essential facilities, such as cable landing stations, local switching centres or fibre backbone networks.

Other steps are: adopting rules to provide for infrastructure sharing, particularly “passive” sharing of towers, ducts, rights-of-way and other support facilities; overhauling and streamlining cross-agency processes to create a ‘one-stop shop’ for various network-related authorizations, such as land management, port access, environmental and safety permits; and adding innovative spectrum management mechanisms that promote increased sharing and efficient use of spectrum.

Regulatory frameworks could be amended to eliminate discriminatory rules that favour one company or industry over another in a converged services market and government policies and rules would be to ensure maximum ability for incumbents and market entrants to choose between different opportunities for business plans and long-term strategies, including resale, wholesale, and niche markets.