1. Barriers to Progress in Converged Network and Services Development William H. Melody Managing Director, LIRNE.NET Melody@Lirne.netMelody@Lirne.net, www.lirne.netwww.lirne.net Presentation at Workshop Convergence of Media and ICT in Egypt: Challenges, Policies and Regulation Cairo, 3 May 2006

2. INFORMATION INFRASTRUCTURE Regional Development Finance/ Banking Disaster Management Travel & Tourism Manufacturing Media & Cultural Sectors Health/Medical Government Services Education/Training Applications Electronic Services (Pay TV, VAS, Internet) Multimedia, etc. (Public, User group, Private) Content Broadcast Media Film Libraries Software etc Interactivity (Instant & Delayed) Voice Data Sound Graphics Video Telecommunication Facilities Network (Information Superhighway) Computing / Information Technology Telecommunication Equipment Manufacturing

3. Significance of Network Unbundling Industry Sectors - Equipment, Operator Networks, Services Fixed and Mobile Basic Network Layers *Content *Communication Services *Network Protocols, OSS & Management *Equipment & Facility Capability

4. Convergence Sectors Drivers of Convergence Technology Industry-Supply Market-Demand Policies/Regulation Industry Specific Convergent Applications Finance Commerce Education Health Publishing Manufacturing etc. Content Telecom Computing The Dimensions of Convergence on the Information Infrastructure

5. From Vertical to Horizontal Markets Layer 4: INFORMATION SERVICES Provision of Content Layer 3: COMMUNICATION SERVICES Basic, value-added & access to information services Layer 2: NETWORK MANAGEMENT Protocols and standards for routing & service quality Layer 1:INFRASTRUCTURE FACILITIES Transmission capacity and interfaces to terminals

6. Steps Toward ICT Convergence Digitalization of the network Mobility Next Generation Internet (Broadband) Media integration (Internet Protocol) E-commerce (QoS) Restructuring of industries Reshaping Policy and Regulation

7. Infrastructure For Digital Economies Higher Capacity Facilities - Broadband? Access to High Speed Networks? Access to Minimal Level of Universal Services? Access to Minimal Levels of Information?

8. VoIP or Everything Over IP? The gradual digitalization of the network has been a steady march to providing all forms of electronic communication over a compatible set of protocols, now called IP From terminals to transmission, switching and local distribution. Network protocols applicable to data, graphics, music, video and finally voice Why are we surprised and poorly prepared for VOIP?

9. ICT Convergence Regulation Access to communication channels and access to content New issues of competition and monopoly Privacy, security, IPR Reducing digital divides? Can content regulation be avoided? The most effective role for national telecom regulators?

10. Entry Points in Converging Markets IT DataInternet ContentEntertainmentEoIP Information Services Communication Services Network Management Infrastructure Facilities Telephone

11. From Regulating Competitors to Opening Markets

12. Open Playing Field Regulation A transition from monopoly/oligopoly direction to maximizing participation via open access Target is not technological neutrality, but maximum development of all technology & services advantages Maximum opportunities for competing firms to achieve public interest goals Maximum stimulation to market development through both private and public participation

13. Policy/Regulation Reassessment to Create Investment Opportunities (1) Structural Adjustment, Phase 2 - empowering regulator as change agent Horizontal Market Definitions - unbundling layers; monopoly nodes Reassessing Licenses - what needs licensing, why, how? - removing service restrictions Application of Competition Principles - from regulating firms to regulating markets

14. Policy/Regulation Reassessment to Create Investment Opportunities (2) Interconnection/Access in Converged Markets - from minutes to Gbits Pricing and Revenue Settlement Standards - wholesale/retail; origination/termination Allocation/Use of Public Resources – spectrum, numbers, names, right of way Public Service Requirements – emergency, security, QoS Social Subsidy Mechanisms – USO, ADC, etc.

15. World Dialogue on Regulation for Network Economies Participate in the Dialogue; review and comment on the research, www.regulateonline.orgwww.regulateonline.org LIRNE.NET, www.lirne.net www.lirne.net A Strategic Collaboration for applied research, training, policy and regulation support, relating to information infrastructure and new network economy development Center for Tele-Information (CTI), TU Denmark Economics of Infrastructures, TU Delft, Netherlands LINK Centre, Wits University, South Africa LIRNEasia, Colombo, Sri Lanka LIRNEamericas, Montevideo, Uruguay Media@lse, London School of Economics, UK