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ITU Global ICT trends & telecom regulatory outlook 2017

ITU (International Telecommunication Union) has published the global ICT trends & telecom regulatory outlook 2017. This report is the first of an annually recurring series of reports tracking market and regulatory trends in the information and communication technologies (ICT) sector and their implications across the world economy.

Regulators reinventing the rules of the game

The regulatory landscape affecting the ICT sector has grown increasingly complex and complicated to navigate. The time where a key focus rested on regulating competitive dynamics among telecommunication players has passed. Today, regulation deals with telecommunication incumbents as well as various digital players with numerous new forms of interaction and interdependency.

As half of the world’s population is not using the Internet, according to the latest ITU estimates, 126 regulators worldwide have to reinvent the rules of the game to extend adoption and use of ICTs, align them with wider social and economic goals and embark on connecting the unconnected as well as safeguarding the quality of existing connections. At least 43 countries now conduct a Regulatory Impact Assessment (RIA) as a formal requirement before regulatory decisions are made.

In some cases, incentive regulation is included to create an enabling environment for further investment, especially in infrastructure. Such developments attest to the great scrutiny now brought to bear on the significant impact of the rules and regulations that govern increasingly important ICT markets. Therefore, Regulatory Impact Assessment and evidence-based decision-making have become mainstream.

Added value of the report

The ICT trends & telecom regulatory outlook 2017 report provides useful insights and a clear, evidence-based perspective on trends and challenges across ICT markets and regulatory frameworks to address the gaps and capitalize on unexplored opportunities.

The report reaches out to the regulatory community worldwide, policy-makers, industry and the ICT community in general. Its findings can provide useful guidance in reviewing and upgrading regulatory frameworks for the ICT sector as the basis for the digital economy, today and for the future.

Main results: 7 major trends moving ICT markets 

  • ICTs move center-stage as digital economy gains momentum
    While the mobile services market has grown hugely, large populations still do not have access to the internet. This is expected to make a shift as the young generation in developing countries make new demands for future connectivity. 

  • Mobile: the engine for expanded local access to the internet
    More than half of the world’s population is yet to be connected to mobile broadband. Mobile virtual network operators have taken up this challenge, targeting underserved market niches while optimizing network coverage to grow subscriber bases. Fixed connectivity leverages ICT for productivity, outreach and efficiency, while mobile is ready to transform economic sectors.   
  • ICTs are less visible but more prevalent
    Cloud computing is the catalyst and enabler of important technological advances. The Cloud transforms data into an increasingly valuable by-product: today’s data trails produced by users using multiple ICTs are massive and growing, generating big data. A new culture of dealing with data is starting to take root.

  • ICTs are enabling and disrupting industries
    ICT focus has shifted towards building platforms which integrate networks, technologies and devices that power new capabilities and services. 5G mobile broadband is being conceptually enhanced and is now ready to take the integration of communications, protocols, devices and applications to the next level. 

  • The rise of the app economy
    The app economy is transforming economic and social activities and opening up channels of innovation, productivity and communication. Technology design deployed by disruptive app companies, reduces transaction costs while allowing for increasing economies of scale. The outlook for both network operators and over-the-top providers is bright as they benefit from a virtuous cycle: as the ICT sector outgrows all others, innovation continues to power ahead creating yet more opportunity. 

  • Market concentration & consolidation
    Led by innovation, digitization and automation, new competitors have gate-crashed markets around the world, stretched boundaries and changed market dynamics. The ICT landscape in 2016 was characterized by high profile mergers and acquisitions involving a wide range of market players, deals and strategic collaborations in fiber, cloud or artificial intelligence.

  • Cyber threats have grown in scope and scale
    Due to massive digitization in consumer and corporate life there is an increased level of threat.  Tools in the hands of terrorists and criminals have become more sophisticated. Although cyber readiness has become imperative for building secure ICT networks and services, not all countries are prepared yet. 

7 Major trends in the ICT regulatory landscape

  • Collaboration
    Increasingly, ICT regulators are teaming up with regulators for other sectors to address multisector issues. Key questions for today’s regulators are: How do we collaborate and with whom? What are we regulating?

  • Rapid and fundamental changes
    The ICT sector can no longer solely focus on its own players and issues, as convergence has blurred boundaries and complicated the regulatory landscape. The pace of regulation in the ICT sector is much faster than in other industries today, with transformation happening all the time.  

  • Scope expansion of regulatory policies
    52 regulators are currently in the G4 category (fourth-generation ICT regulation).  55 % of regulators have moved 1 generation up the ICT ladder of regulation, while 15% have leaped generations in just 5 years. On the other hand 25% of countries have not seen any regulatory movement since 2007.  

  • Regulation as an equalizer
    Regulation ensures a level playing field for all market players. However, competition is key to drive innovation, diversify services and improve consumer experience in ICT markets.

    The regulation of that competition continues to trigger increased accessibility of ICT markets, from basic telephony to mobile broadband. 

  • Shift to monitoring and enforcement
    The scope of monitoring and enforcement is expanding. Challenging issues have sparked global debate, including quality of information shared on social media and taxation of market players without national physical points of presence.

  • One ICT regulatory model does not fit all
    A single regulatory model does not exist. Although increasingly, a common standard is being established in terms of efficiency, extended network access and affordability and quality of service.

    On the other hand new issues keep emerging that pose regulatory challenges, of which some may require collective action by the international community while others cause market disruptions.  

  • Regulators are facing the challenges and reinventing the rules
    Expectations of ICT regulation have grown. 43 countries conduct a Regulatory Impact Assessment prior to regulatory decisions. Incentive regulation is often included to encourage investment, especially in infrastructure.

The Global ICT & Regulatory Outlook 2017 is available for purchase via ITU.

(Source: ITU | Telecomlead. Global ICT Regulatory Outlook 2017 Executive Summary. BT&P Publication period: 2017).