report highlights the crucial link between effective regulation of the ICT sector and the diversity, quality, and affordability of ICT services available to users and businesses.
Dedicated to "Transnational Aspects of Regulation in an Interconnected Society," this year's report reveals an increasingly complex and interconnected legal and regulatory environment in which decisions made in one market can have significant repercussions in neighboring countries and even distant markets.
The report confirms the rapid and uninterrupted expansion of technology markets worldwide. With the rapid growth of broadband, global IP traffic has skyrocketed from a modest petabyte two decades ago to an estimated 44,000 petabytes (44 exabytes) at the end of 2012. To give an indication of the enormous volume this represents, it would take 1,100 years to download that volume of data over a 10 Mbps broadband link, or more than 200,000 years with a dial-up connection. In 2013 alone, IP traffic is projected to increase by approximately 14 exabytes per month, the monthly equivalent of twice the total global traffic accumulated during the decade from 1994 to 2003.
This massive increase in traffic volume is due to several factors: the growing number of connected users and connectable devices, the trend toward multi-device ownership, the abundance of highly diverse and, in most cases, free online content, and the increasingly widespread access of consumers to fixed and mobile broadband networks that can support high-bandwidth services such as live video streaming. The total number of people connected to the Internet is projected to exceed 2.7 billion in 2013, while the total number of applications downloaded by all types of devices is expected to surpass 50 billion.
Data continues to generate 90% of total consumer traffic, with the largest volumes associated with file sharing, live video streaming, video calls, and online gaming. New mobile devices, which provide a high-quality user experience, are driving faster adoption of gaming and video calls, both of which are expected to continue growing at over 40% annually between 2010 and 2015.
For regulators seeking to promote a level playing field and ensure non-discriminatory practices and transparency of information in the market, this period of transition to a truly transnational ICT services market is creating a need for stronger cross-border, regional, and international cooperation.
"These are exciting times for regulators as the full consequences of the long-term trend toward the globalization of services are now beginning to be felt," said Dr. Hamadoun I. Touré, Secretary-General of the ITU. "The challenge for regulators is to create the right environment for the evolution of services and competition that guarantees better quality services and cheaper offers, and ultimately ensures that consumers reap the benefits."
A snapshot of a rapidly changing market:
The most comprehensive annual study available on the current state of regulatory frameworks and technological developments worldwide, Telecom Reform Trends, begins this year with an overview of the "megatrends" shaping the ICT landscape.
Topics covered in depth include net neutrality, new models for spectrum policy management, mobile roaming pricing, and the challenges and opportunities presented by the widespread adoption of cloud services.
The report notes that the debate on net neutrality remains clouded by the lack of a consensus definition of the term among regulators themselves. It formulates recommendations on acceptable traffic management practices and those that could be considered anti-competitive.
In the area of spectrum policy, the constant pressure on spectrum availability caused by the rise of mobile systems shows no signs of abating, and experts predict an 18-fold increase in mobile traffic between 2011 and 2015, driven by machine-to-machine communications, over-the-top (OTT) services such as VoIP, and new types of cloud services.
Current best practices in spectrum management favor the reorganization, reuse, and liberalization of existing management frameworks. To achieve the maximum and most efficient use of frequencies, spectrum licensing is increasingly shifting towards market-based policies, such as auctions, in-band migration, spectrum sharing, and spectrum trading, to supplement or even replace slow bureaucratic processes.
Mobile roaming charges were a key issue during the renegotiation of the latest International Telecommunication Regulations (ITR) in Dubai last December. The Telecom Reform Trends 2013 report notes that studies conducted worldwide confirm that current retail prices for international mobile roaming remain high, bear no relation to domestic mobile prices, and do not reflect the actual cost of providing the service. These high retail prices are generally due to underlying wholesale prices in the countries visited, but given the relatively weak competition in the international roaming market, market forces alone are insufficient to rectify the situation, the report states. One suggested solution is empowering consumers by increasing price transparency.
Finally, the rapid growth of cloud computing is giving rise to a number of new regulatory issues, such as ensuring privacy and clearly asserting ownership of personal and business data, addressing the use of stored data by unauthorized third parties, determining legal frameworks (if data is stored on servers in different locations), and avoiding anti-competitive dependency situations for users of different types of cloud services. Cloud traffic continues to grow rapidly and is projected to account for at least two-thirds of total network traffic by 2016.
Changes in Revenue Streams:
The growth in the number of users, applications, and high-bandwidth traffic is increasingly driving revenue growth in the ICT sector, but traditional operators appear to be losing ground to new entrants. It is projected that up to 6.9 percent of cumulative revenue from telephone services (representing $479 billion USD) will shift to VoIP OTT services by 2020, with total OTT revenue expected to increase from $8 billion USD last year to $32 billion USD by 2017.
At the same time, however, the situation for OTT service providers is becoming increasingly challenging; for example, a recent case in which an OTT service provider had to compensate a traditional telecom operator for traffic generated by its network. Events of this nature could set an important precedent for other operators worldwide, according to the report.
New services and devices are creating new usage patterns and new revenue models. Currently, several operators conduct their business in the same markets, but under different regimes (for example, traditional telephony providers compete not only with operators in adjacent markets, such as ISPs and cable operators, but also with content and application providers, such as OTTs). Competition- and market-based approaches to broadband regulation align with the imperatives of "universal service," as broadband access is increasingly seen as a right rather than a luxury.
Independent regulators have now been established in 160 countries. The next trend is likely to be toward convergence regulators that combine the domains of traditional telecoms, data services, and broadcasting. The Report also encourages ICT regulators to expand their competencies into new policy areas, such as data protection and privacy, climate change and electronic waste, where they can play an important role in ensuring national and regional coordination, and the formulation of appropriate strategies and standards.
“The complexity of the problems posed by regulating an interconnected society is increasing every day. As more networks are deployed and interconnected, the services carried by these networks are becoming increasingly transnational. And as the intertwining of broadband services and applications across a wider range of social, economic, and governmental functions deepens, the need to apply a coherent regulatory approach at all levels to common problems such as data protection and privacy in a cloud environment will become more pressing,” said Brahima Sanou, Director of the ITU Telecommunication Development Bureau, which produces the annual Telecommunication Reform Trends Report, a key publication of the Global Symposium for Regulators (GSR) that it organizes each year.
"Regulators must ensure they have sufficient flexibility to adapt to a rapidly changing market and the necessary expertise to navigate uncharted territory as the complexity of multiple service offerings and infrastructure ownership increases. In this area, the ITU GSR can play a vital role by offering regulators worldwide the opportunity to exchange experiences with their peers, learn from each other's successes, and create a globally accessible set of best practices that everyone can benefit from."
Equinix selects Infinera Cloud Xpress for data center interconnection in Hong Kong
Infinera announces that Equinix has selected Infinera Cloud Xpress to interconnect its data centers in Hong Kong. Infinera Cloud Xpress offers Equinix a platform with hyperscale density, operational simplicity, and low power consumption.
