ITU Telecom World

Critical to the continued success of the ICT sector is the need to narrow the trust deficit between the four critical stakeholders of the sector – the policy maker, the regulator, the private sector and civil society. In an ideal world, these stakeholders work harmoniously to ensure that the sector continues to invest to extend network coverage where it is most required.

Particularly when one considers that the mobile telecommunications sector represents one of the most significant success stories of the modern African economy over the last 20 to 25 years. Through mobile connectivity, Africa has witnessed significant development.

Considering the noticeable progress that has been made in the quest to provide access to all – first for voice and now for data and other services – it would be reasonable to conclude that the current funding and business models have worked well. The funding and business models have fostered partnerships that have incentivised the investment of billions into ICT sectors across Africa and the rest of the world.

But what may have worked in the past is not necessarily the blueprint for the future.

It is for this reason that the third session of the Ministerial Roundtable at the International Telecommunication Union (ITU) conference ITU Telecom World 2018 in Durban will explore new financing and business models required to advance digital transformation and move towards smarter societies throughout the world.

During the session, we will ask: what can we learn from the initiatives and recommendations presented in other platforms such as the OECD roadmap for digitalization, or the Broadband Commission discussion paper “A New deal: investing in our common future. Policy recommendations to close the broadband gap”? What successful case studies and best practice in public private partnership can we draw on? How can governments provide a healthy investment climate through transparent, fair and stable initiatives in areas such as regulation, licencing, taxation and spectrum?

The easy conclusion that one can likely draw in advance is that partnerships are the solution. Given the fact that each critical stakeholder will have vastly differing vested interests, actively working towards narrowing the various trust deficits has never been more critical in the context of a 4thIndustrial Revolution that threatens to widen inequality in markets that lag behind.

Closing the rural coverage gap, for example, cannot be achieved by the industry alone. Governments should play their part by implementing policies and regulations that eliminate unnecessary costs, enhance flexibility, and increase investor confidence.

The options available to connect rural populations include amongst other things, prescribing rural coverage obligations as part of spectrum licence conditions, effective utilisation of Universal Service Funds and providing subsidies to drive appetite.

Subsidies which can be direct monetary grants to indirect incentives, such as tax rebates can spur operators’ moves to extend coverage and ensure sustainable financing models.

An example of a well-targeted subsidy, noted by the GSMA, is the tax rebate system introduced in Malaysia in 2014. This, which gave corporate income tax rebates (up to 70%) on capital investment in rural areas, and exemptions on import duties for last mile connectivity equipment, giving a direct incentive for operators to increase their investments in rural coverage. It’s a prime example of an innovative solution premised on a collaborative effort.

We need innovative solutions to this and many other issues that will be widely debated at this year’s ITU. From a Vodacom perspective, we are proud to be one of the sponsors of this year’s conference as it brings together leading experts from all over the world to discuss Sustainable Development Goals within ICT. Look forward to seeing you there!

Mobile virtual network operators (MVNOs) play an increasingly important role in the telecommunications industry. ITU News recently caught up with Sasaki Futoshi, Deputy General Manager, Strategy and Business Development, MVNO at Internet Initiative Japan Inc. (IIJ), about the opportunities for MVNOs in Asia and beyond. Mr. Futoshi will speak at ITU’s “Rise of the MVNOs – Leveraging MVNOs in an ‘everything connected’ world” event on 12 September in Durban, South Africa.

What are the opportunities of expanding MVNOs in Asia?

Asian MVNOs have established or are establishing strong domestic market positions to deliver unique and cost-efficient services to their customers. Adding to this, from the international point of view, there are a lot of opportunities for Asian MVNOs as the trans-Asian movement of people and products increases.

Learn more about the ‘Rise of the MVNOs’ workshop at ITU Telecom World

Asian mobile markets are quite huge and are full of variation. Japan, South Korea, China, Hong Kong and Association of Southeast Asian Nations (ASEAN) countries all have different mobile market landscapes.

This variation and diversity could not be supported by the effort of mobile network operators (MNOs), which are essentially domestic beings, contrary to MVNOs, which have a little asset binding to land.

We Asian MVNOs have new opportunities to provide international services, both for people and for the Internet of Things (IoT), as well as to provide existing domestic services.

What are the benefits of increased connectivity?

Mobile phones are already in the hands of people, and people are always connected. But mobile phones, even smartphones, are merely for connecting people; phone calls, e-mails, etc. are only connecting one person to another.

But low-power wide-area (LPWA) and fifth-generation wireless (5G) technologies enable the connection of ‘things’ to each other. Those technologies have the potential power to change people’s lives, thinking and even culture.

RELATED: One world, one global SIM: How ITU-allocated ‘global IMSI ranges’ support IoT and M2M connectivity

Also, it has to be noted that it is very hard for the telecom sector to accomplish these makeovers by itself. Despite telecom operators’ increased use of the Internet, telcos’ nature to connect one person to another has changed little from the age of Graham Bell.

In the upcoming Internet of Things (IoT) era, the cooperation between telcos, including MVNOs, and the companies that have a fundamentally different mindset from telcos is the only way to make innovation possible.

What are the challenges of the 5G era for MVNOs and how might they be overcome?

Before 5G, MVNO’s typical distinction is in how much the network facilities are operated by MVNOs. If they operate none of the network facilities, they are called “Light MVNOs” or “Wholesalers.” If they operate much of the network, they are called “Full MVNOs.”

5G network architecture, however, is characterized by virtualization and all will go beyond the horizon of virtualization. Like a cloud, one MVNO might operate all networks figuratively, while at the same time they might operate none of networks literally.

‘The best regulations could vary not only by country or region, but also by the stage of the MVNO industry’s development.’

In the 5G era, MVNOs could utilize the host operator’s mobile network to build their own business, same as before 4G, however, it might be the virtualized core network, called the “slice.” Network functions virtualization (NFV) and “Slicing” could be inevitable for many MVNOs in the 5G era.

From this perspective, we also have to look for new and unprecedented relationships with our host operators.

What would you like to see out of regulatory environments?

The role of regulation is quite sensitive for fostering a healthy MVNO industry.

In some markets like Japan, unfortunately, MVNOs are not spontaneous businesses that can be easily created. So a clear and decisive will of regulators to introduce competition to the telecom market might be necessary.

RELATED: Regulation can help deliver on the promise of the digital economy

At the same time, the most important thing is encouraging innovation and strict regulation often suppresses imagination.

The best regulations could vary not only by country or region, but also by the stage of the MVNO industry’s development.

How has Internet Initiative Japan (IIJ) contributed to the mobile market?

Internet Initiative Japan (IIJ) was founded in 1992 as the first Japanese Internet Service Provider. Today IIJ is one of the leading telecommunication service providers in Japan.

IIJ provides comprehensive network services – not only fixed Internet access, but also data centers, cloud services, outsourcing, applications and mobile business as a mobile virtual network operator (MVNO).

IIJ’s MVNO was the first Japanese MVNO to support the 3G network in 2008, the first MVNO to support the Long-Term Evolution (LTE) network in 2012, and the first full MVNO, which is a virtual operator with its own mobile core network and own mobile network code (MNC).

‘We have always been looking for the path to new and innovative MVNO business…’ – Sasaki Futoshi, Deputy General Manager, Strategy and Business Development, MVNO at Internet Initiative Japan Inc. (IIJ)

IIJ has three different customer segments: consumers, business customers, including machine-to-machine (M2M) and Internet of Things (IoT) applications, and partner MVNOs, in which IIJ plays the role of a mobile virtual network enabler (MVNE), which provide network infrastructure and related services to MVNOs.

IIJ is hosted by NTTdocomo and the KDDI mobile network, and its total number of subscribers exceeded 2 million in 2017.

We have always been looking for the path to new and innovative MVNO business and have brought healthy competition into the Japanese mobile market so that Japanese customers could have the benefit of diverse options.

Governments and regulators around the world are working to make spectrum available for exciting new 5G services. There is global agreement that more spectrum is required: without a sufficient amount, consumers won’t be able to realise the true 5G experience.

Which bands will become available, when they will become available, and how is still to be decided, and the next big step will be at the upcoming World Radiocommunication Conference, WRC-19. ITU Telecom World 2018 provides an excellent opportunity to talk about this topic, and spectrum in general.

WRC-19 will take place from 28 October to 22 November 2019 and what happens there will have a major impact on the future of 5G.  Spectrum for mobile broadband in millimetre wave frequencies between 24.25 GHz and 86 GHz is on the agenda. The mobile industry has been working hard to complete sharing studies and pave the way for access to these important spectrum bands.

We know that wide blocks will be needed in the mmW bands for mobile operators to offer ultra-high speed 5G services that excite users and facilitate new services for businesses.

For WRC-19, the most important bands are 26 GHz, those around 40 GHz and 66-71 GHz.

Planning for the future is key. Adding an IMT identification for the whole 37-43.5 GHz range (which we call the “40 GHz” bands) at WRC-19 does two important things. First it creates the opportunity for individual countries to assign the portions of spectrum that work best for their specific situation.

Second, it facilitates equipment development across the broader range. This allows countries to do what is best for them and still enjoy the benefit of the economies of scale that come from equipment harmonisation across the broader range. This harmonisation ultimately benefits consumers – with more and lower-cost equipment being developed.

Fortunately, technical studies demonstrate that adding mobile in these bands is possible while still protecting incumbent users. Fair and open studies on spectrum sharing among industries benefits everyone, and we urge more of them as we make our way toward WRC-19.

National regulators have the challenge of needing to balance multiple needs. They are working with industry to make the spectrum identified at previous conferences available at the same time as planning for new spectrum identification at WRC-19 in higher bands. As challenging as it is, this work is extremely important because 5G will rely on low-, mid-, and high-band spectrum. The results are seen in trials around the world which are already showing 5G’s potential.

Gigabit speeds and low latencies are already opening the door for countless new and improved services, including high-speed broadband to homes and offices; industrial automation; and augmented and virtual reality. That regulators and governments are seizing the opportunity to make 5G the best it can be and making the right spectrum available under the best conditions is essential.

Of course, just identifying the bands available to mobile operators isn’t enough. Outside of the WRC, national regulators will have to make critical decisions about the amount of spectrum to assign, the technical conditions, the timing of the release and what access to it should cost. All these factors will have a major impact on the spectrum mobile operators will be able to make use of, and therefore on the quality of 5G services.

At ITU Telecom World, the GSMA will take part in two sessions on these topics: Spectrum challenges: preparing for WRC-19 and Spectrum pricing to drive the mobile broadband revolution. The GSMA also has a booth. Please make sure to visit and attend them – I promise it will be worth your time.

Data protection laws aim to do the very necessary job of safeguarding consumers and individuals in a digital, connected world, but we cannot neglect the impact on the companies that must meet these requirements.

As the association representing IT decision makers in Belgium, Beltug’s positions are drawn from the real experiences and concerns of business users of IT and digital technology in private and public entities of all sizes, including banks, local governments, retailers, manufacturers, and much more. These topics are also shared within our international association, INTUG. The ‘business users’ directly bring to us their challenges, and data protection laws are a priority topic for them.

Among their concerns are the lack of harmonisation on an international scale, which puts an undue strain on companies’ resources. Very many companies operate in more than a single market, and thus face multiple regulatory regimes. This is by no means only on an intercontinental basis: even within the 27 countries of the European Union, with the General Data Protection Regulation as a common ground, rules vary by country. Yet it is each company’s responsibility to ensure that they comply with the different requirements.

This requires, among many other obligations, translating complex, lengthy legal texts into practical IT implementation. By their nature, legal texts leave room for interpretation, and can be tens of pages long: conversely, IT and digital technology should be perfectly precise and, ideally, concise. This adds additional complexity. Regulators must keep in mind that the regulations they are drafting will bind all companies: not just the Facebooks and Googles of the world.

At the same time, technology evolves at a much faster pace than legislation, which puts brakes on innovation and the adoption by companies of new technologies that will support them. To give a single example, Blockchain has provoked a vast amount of involvement and interest by companies, opening exciting new possibilities. But Blockchain is not compatible with current data protection laws. So companies are hesitant to take advantage of the benefits it can bring. And we all suffer from this drag on innovation and growth: companies, individuals, national economies, international trade…

This disparity of development also creates a lack of clarity for businesses. One of the key questions they need answered: in a smart data-driven economy, or in ecosystems exploiting IoT, who owns the data? Who can commercialise the data? And how can we make sure the data is well-protected?

These are only a few examples to highlight how important it is to consider business users when drafting regulations that will impact them. The legislation must not only protect the privacy and rights of the individual, but simultaneously support and uplift the businesses that are critical to a strong economy. I look forward to exploring the options with a cross-sector panel of stakeholders in the Strengthening collaboration in data protection session at ITU Telecom World 2018 in Durban.

The last time I was in Durban was in 2010. South Africa was hosting the FIFA World Cup and the whole country was abuzz. There was no missing it, no one was left behind. I am coming back for ITU Telecom World. This time, it is not soccer on my mind, but access to broadband opportunities.

The same question comes back: can we harness the full power of the web when half of the world is still offline? This includes politics, public services and market value. Being online is no longer a ‘nice to have’- it’s a right we all have, but only half of us are benefiting from currently.

Over the next few months, we will cross an historic milestone where 50% of the world will be connected. As important as this is, we need to consider the impact this will have on those not connected. They will continue to lag behind as half of us will be benefiting from the digital revolution.

While 50% of the world will soon be ‘digital haves’, only 21.8% of Africa’s population is currently connected (ITU). This is a stark reality. There remains a need to invest in broadband infrastructure in Africa. The majority of people are shut out from being able to learn and earn online, and have a voice. Here are three things stakeholders can do to help connect:

1. Invest in women and girls. Our Women Rights Online Digital Audit shows that women are 50% less likely than men to be online in the areas surveyed, and 30-50% less likely to use the internet for economic and political empowerment. We need to change this.
2. Use available funds to extend connectivity. There is an estimated US$408 million sitting unused in Universal Service and Access Funds throughout Africa; these funds are collected specifically to expand internet access. That’s enough to bring 6 million women online, or to provide digital skills training to 16 million women and girls. Failure to expand connectivity to all risks widening global inequality and undermining global development.
3. Harness the connectivity tipping point. We all have a role to play in connecting the last 50% and ensuring that everyone can benefit from the web. At the Web Foundation, we’re working to change policy to enable more people to come online and have equal rights online. The Alliance for Affordable Internet is working with around 80 members towards this. Ghana and Nigeria, as well as ECOWAS, have all signed on to enabling policy to meet the affordability threshold – 1GB of data for no more than 2% of monthly income.

It is critical that all stakeholders join forces to connect the unconnected and to extend the opportunities of global digital benefits. Join us in Durban.

Nnena will be speaking at the High Level African Investment Dialogue.

Economies, governments and societies across the globe are going digital. About half of the world’s population is now connected to the Internet, up from 4% in 1995. In many countries, digital transformation is now characterised by almost universal connectivity, but also by ubiquitous computing, and draws on the generation and use of vast amounts of data.

Technologies continue to develop rapidly and are combining in novel and innovative ways, pushing digital transformation in new and often unpredictable directions. Together, governments and stakeholders must shape a common digital future that makes the most of the immense opportunities that digital transformation holds to improve people’s lives and boost economic growth for countries at all levels of development, while ensuring that nobody is left behind.

Since digital transformation is transversal, the policy response must be holistic. Digital transformation affects many aspects of the economy and society in complex and interrelated ways, challenging existing policies in many areas. As a result, silos are disintegrating, and hard borders are becoming less relevant. This means that stronger co-operation and collaboration are critical, as well as a re-think about how policy is developed and implemented.

In particular, a flexible, forward-looking and integrated policy framework that cuts across policy silos is essential to ensuring a coherent and whole-of-government approach to fully realise the potential of digital transformation and address its challenges. Under the auspices of the OECD’s Going Digital project, the OECD is developing such an integrated policy framework. It includes seven building blocks – Access, Use, Innovation, Trust, Jobs, Society and Market Openness – that are supported by quantitative indicators and practical policy guidance.

Not only do governments need an integrated policy response to digital transformation, they must also seize the opportunity to go digital themselves. Governments – at the local, regional and national levels – can use digital technologies to improve efficiency and targeting, enable innovative policy design and rigorous impact evaluation, and expand citizen and stakeholder engagement. Many governments and administrations are currently exploring the possibilities, testing the potential, and evaluating the effectiveness of using digital technologies for improving policy design, implementation, and enforcement.

The OECD partner session at ITU Telecom World 2018 – Going Digital: An integrated and effective approach to policymaking in the digital age – will present the OECD integrated policy framework and invite a panel to debate how to make policies in the digital age more coherent and effective by using digital technologies. This is critical, because the use of digital technologies not only drives market dynamism by enabling innovation and new business models, but it also has the potential to transform how policy is made and how governments interact with their citizens. This panel will be an opportunity to hear first-hand what governments are doing as they go digital.

AI and blockchain trends

By 2030, AI (artificial intelligence) may drive nearly $16 trillion US (ex. PwC) in added wealth creation through productivity enhancements and consumer personalization/higher quality services. In fact, the consumer impact will exceed the gains from productivity improvements over time. This represents more than $1 trillion in business value today. One example is JP Morgan Chase, one of the world’s largest banks, eliminating 360,000 hours spent in annual manual contract compliance checking, reducing it to seconds using AI.

Today there are more than 2,200 cryptocurrencies (with bitcoin as one example) with market value reaching nearly $1 trillion in 2018. High volatility is evidenced, with the value dropping well under $500 billion and growing regulation to protect consumers.

This has led the growth of ICOs/ITOs (initial coin/token offerings) where a cryptocurrency/token is offered to drive or fund a project. ICOs representing under $8 billion in 2017 could reach as much as $40 billion in 2018, and are receiving substantial investment from angel and seed investors. Examples are Telegram, raising more than $1.7 billion 2018, and EOS with more than $4 billion raised.

The underlying technology behind cryptocurrencies is often denoted as blockchain.  Blockchain is ever expanding in capabilities with applications in more than 50 industries – it is the driver for new business models and innovation. This comes from transferring value via transactions between parties securely, quickly, and without intermediaries, thus lowering costs.

Blockchain is the new value-delivery internet. Examples are Samsung converting their supply chain to blockchain to drive down costs by 20%; Walmart using blockchain to track food shipments in seconds, instead of the week this used to take;  and the use of blockchain in financial services to lower fees for payments, speed up transaction clearing and settlements to real time, lower borrowing costs, and provide alternates to representing securities and another means to raising funds (ICOs) –  disrupting the $130+ trillion global market (ex. CBInsights).

Blockchain also offers the ability to provide or track national identities where consumers manage their own data, provide trackable identities to devices in the Internet of Things (hitting 40 billion devices and sensors by 2022), and deliver a new platform for services – a new internet.

There is even a combination of distributed AI or decentralized AI where blockchain provides the open platform for the sharing and consumption of AI services from anyone – an open crowdsourced AI marketplace. Singularity.net is one such example, raising $30+ million in under 60 seconds with their own ICO – see my recent chat with Ben Goertzel, CEO SingularityNET, in the ACM Learning Center.

What does this mean to Operators (Mobile and Mobile Virtual Network)?

Data and airtime are commoditized with the clear differentiators and higher margins in value added services to subscribers.

Operators can use blockchain for new financial technology services (fintech) where they can provide mobile banking services such as micropayments, loans, and cash-based transactions with security and authentication already built into the platforms.  Beyond financial services, Deutsche Telecom’s City Pass is a good example of an operator providing community membership privileges and services offered by cities via blockchain. Announced this year, we have MoBee, creating a new mobile virtual network operator ecosystem combining blockchain and ICO/ITO offerings. Their 3 links structure consists of a platform for mobile operators, service experts and outsourcing providers; MoBee virtual operator as the hub; and a subscriber platform using crypto funds.

Combining big-data analytics, AI automation and augmentation provides real-time consumer insights and needs to operators and predicts future behaviour. Purchase decisions are guided towards consumer execution due to the close match of products and services to wants. Only AI has this data capability. This creates profits for operators and much better service to consumers.

Be part of the 1st #MVNO roadmap for international collaboration at the Rise of the MVNOs Workshop

Conclusion

We are in the midst of the 4^th Industrial Revolution and Industry 4.0 (A Triple C–hyper: Automation, Compression, Convergence, Connectivity) where there is unprecedented innovation producing growth opportunities. AI and blockchain are at the forefront for tapping into new markets and existing markets – all with better personalization and higher quality services and at lower costs. The winner – everyone!

Stephen Ibaraki is speaking at the Forum session on “Digital finance: innovative economic solutions for all” as part of the Smart ABC Programme at ITU Telecom World 2018