Regulatory Roundtable – “Ensuring participatory regulation for an equitable and safe digital future”

Digital World 2021 Highlights October

Tech sector regulators are carving out a new role as facilitators and enablers to address the new realities of our digital world. Multi-stakeholder engagement and collaboration are critical to balance competing needs to boost innovation and infrastructure deployment whilst protecting consumers, regulating data usage and creating a level playing field, explained expert moderator Sofie Maddens, Head of Regulatory and Market Environment Division, Telecommunication Development Bureau, ITU, at the start of this ITU Digital World 2021 Regulatory Roundtable.

“As the world becomes increasingly digitalized, we need to join efforts to make connectivity safe and affordable,” urged Ekaterine Imedadze, Commissioner, Georgian National Communications Commission. Collaboration, from infrastructure sharing to cross-border industry regulation or cross-sector flexible frameworks, is key to reducing the digital gap and ensuring the digital economy is a powerhouse for economic growth, panelists agreed.

Regulating for digital infrastructure to close the digital divide

The COVID-19 pandemic has shown us more than ever how essential digital connectivity is to social and economic development. It has also exposed the access and connectivity limitations of digital infrastructure around the world as the digital divide threatens to deepen further.

For Chenda Thong, Chairperson, TRC, Cambodia, digital infrastructure has become a foundation and critical enabler of connectivity to facilitate the continuity of daily life, connecting people during the pandemic more than ever. As post-pandemic recovery begins, people now need to embrace as normal new digital behaviours across all areas of life and work, including online meetings, ecommerce, telemedicine, e-logistics, contactless payment, remote learning and e-payment.  The sudden switch to remote working proved more successful than expected, but regulators now face challenges from the growing pressure for infrastructure upgrade, investment, quality of service and safety in the digital space, he added.

Recently appointed Chairman of the Mozambique Communications Regulatory Authority (INCM), Tuaha Mote, outlined how regulators can foster affordable access to connectivity in developing countries, where resources may be limited and operators must be encouraged to invest in non-profitable low income areas.

“Operators are here to make money. So, for the operator, communications and the mobile network has a commercial value, but for the government it has a public and commercial value,” he stated.  To incentivise private sector investment, governments must work across agencies, involving finance ministers, for example, in adopting taxation exemptions. The regulator must also ensure adequate and appropriate allocation of spectrum, both on a commercial basis and on a coverage obligation basis. This is a priority in Mozambique, where spectrum reserved for new operators remains partly unused, benefiting neither government, private sector nor the end user.

Digital infrastructure deployment is a huge challenge which calls for a concerted effort, he stated: “We have to bring on board other sectors of the economy like oil, gas and mining. If all services, including public services, go digital, we have to involve citizens … and not defer this challenge to industry and regulators alone.”

Regulatory authorities have an important contribution to make to bridging the digital divide, argued Mieke de Regt, Senior Advisor, International Relations Dept., BIPT – BEREC CN Chair 2021. Citing a recent study on the real impact of the digital divide on European economies and the need to increase affordable access, she highlighted effective initiatives to stimulate investment in very high capacity networks, foster network infrastructure sharing and reduce the cost of broadband network rollout, especially in rural areas.  Additional measures include reducing the cost of spectrum auctions, launching price comparison tools for customers to find the cheapest services for their needs, and fostering collaboration between regulators, industry and policy makers “to identify bottlenecks together.”

“Given the timeframe we are in now after the pandemic, we see that recovery funds related to the coronavirus can really be leveraged to accelerate the deployment of very high capacity networks, especially in underserved areas”, she said.

In light of the need for major investment in infrastructure to extend and improve connectivity, infrastructure sharing can ensure the efficient allocation of scarce resources, avoid unnecessary duplication and minimize environmental impact, stated Maria Alexandra Velez, Senior Director, Government and Regulatory Affairs, International, SBA Communications.

“Industry players and government should get together and find the best ways or mechanisms to make infrastructure sharing a reality,” she said, citing successful measures such as establishing a radius of non-proliferation or the requirement for new infrastructure to prove there is no existing infrastructure which could accommodate more antennas.

“Close coordination between national government and municipalities” is very important to smooth the path for operators and tower companies, as infrastructure deployment is a local activity requiring permits at a local level. Capacity building will provide municipal authorities with the technical expertise to provide the best regulatory framework for infrastructure deployment, including clear processes for issuing permits based on technical criteria, a registry of towers to map existing infrastructure and coverage gaps, the provision of rights of way, and opening up public goods and other existing infrastructure such as electricity to sharing.

Maintaining trust in the data era

Beyond measures to ensure infrastructure deployment, from infrastructure sharing to fiscal incentives, spectrum policy and collaboration across national, regional and local governments, regulatory bodies need to protect consumers – and maintain trust, in particular in the transmission, storage and use of data.

Consumer trust is critical given the importance of data to prosperity over the coming decades. Chris Calabrese, Senior Director, Privacy and Data Policy, Microsoft, outlined how data can be used to solve many of society’s problems, stimulate economic growth and address major global challenges such as climate change and pandemics. Data is a valuable resource as it can be leveraged to benefit many different people, business and causes simultaneously, he said, citing the example of satellite footage which can be used to predict weather, measure transport flow, help rebuild after natural disaster, assist in urban planning or monitor climate change. But privacy and civil rights must be protected in the way in which data is used, he added: “If we are to flourish as a society, we have to invest in both technology and in legal rules to allow us to use data in a trustworthy way.”

For Danielle Jacobs, CEO, Belgian Association of CIOs and digital technology leaders (Beltug), data is crucial for the business community – and data privacy and security are pressing concerns. Issues include where the data is, who has access to what information, whether data is used for new commercial services or for public good, and who has control over the increasingly large amounts of data stored in the cloud. Trust can be established by ensuring relevant legislation – and regulatory guidelines to implement the legislation clearly and with confidence.

New regulatory challenges

“Where regulators were once seen as market overseers, gatekeepers and arbiters, the ‘new generation’ of regulator are facilitators”, explained Maddens. The ICT sector is fast-moving, calling for equally swift regulatory responses. We have a unique opportunity to rethink and reshape policy principles and regulatory best practices to guide and stimulate post pandemic growth as ICT regulators and policy makers are now the master builders of digital transformation.

Regulators face new challenges in the digital area, explained Cambodia’s Thong. Lack of access to affordable broadband and digital literacy can be addressed through implementation of universal service funds and facilitating infrastructure sharing. Traditional competition frameworks, however, are no longer effective where digital providers are often large, international companies working across borders. National regulators, especially those in smaller states, cannot impose effective measures alone.

Further challenges include consumer issues from personal data, and the convergence of sectors in the digital economy, so that tech sector experts are confronted with the need to understand new industries before they can regulate them.

Nicolás Silva Cortés, Commissioner, Communications Regulatory Commission (CRC), Colombia, agreed that the historical role of regulating investment, quality of service, consumer protection and market competition must now be extended to incorporate new, innovative topics driving industry growth.

“We believe it is important to design regulatory strategies as a real tool for innovation to close the connectivity gap and build a comprehensive digital society,” he said. Regulators should promote innovation in the market as the industry continues to evolve, adopting new tools to facilitate the relationship between operators, users and government. “We as regulators must promote actions to simplify regulatory frameworks and make it easier for all different agents,” he continued, especially in the face of new challenges such as data protection and digital identity.

Imedadze highlighted how the pandemic has shown the need to address the digital skills gap across the sector to enable national economic development. It is important to create a transparent, equitable regulatory framework with harmonized legislation that is understandable and attractive for investors; to empower SMEs through formal and legal instruments as the engine of economic growth and provide them with knowledge on how to engage in the economy; and to increase digital literacy for different age groups to bring a better understanding and ability to benefit economically from broadband and digital infrastructure, she explained.

These regulatory initiatives will support overall growth from all stakeholders at local, regional and national levels, enabling the state to be better equipped with digital skills for the future. A new model of regulator, acting as enabler or facilitator and incentivizing capacity building and education throughout the sector, is important, she added.

De Regt echoed the need to harmonize regulatory frameworks, explaining that in Europe “we are moving away from the clear-cut concept of regulation based on competition law” towards a regulatory toolbox with softer pieces of legislation including recommendations and best practices. This will enable policy makers to focus on geopolitical elements and societal needs to meet the goals of full connectivity, sustainability and cyber security.  There is also a strong emphasis on digital skills and ethical values, whilst reaping the fruits of the data economy. It is both interesting and challenging to see these elements coming together in the digital future.

Calabrese reminded panellists that, contrary to an oft-repeated maxim, data is not like oil. It is a resource which can be used and reused, a powerful renewable resource. Harmonization of data regulation is a challenge, building different privacy laws in different parts of the world to reflect different cultural definitions of privacy.  It is important to support harmonized legal regimes, grant customers control over their own data and demonstrate trustworthiness with regulatory tools and supporting legislation.  He added: “If people really believe their data is well protected, we will create an environment and ecosystem where data can be used for the benefit of all of society.”

Jacobs urged regulators to consider business and professional users as well as individual consumers. The biggest barriers businesses face in implementing digital strategies include cybersecurity, harmonizing cross border regulations to address cross border data flow, and regulating cloud providers so that businesses have a choice and are not locked into a given solution, software or company. “Regulators and policy makers are more important than ever, and are now seen as fostering faster innovation,” as with workable regulations, sandboxes, best practices and guidelines, digital innovation can take off, she said.

Amir Algibreen, VP Regulatory Affairs, STC, Saudi Arabia, pointed out that challenges also differ between countries and regions depending on the extent of digital development. Some regions may be moving customers and industry from 3G to 4G; in other countries, the key issue will be controlling data monetization and the cross-border supply of data. Current regulatory regimes may no longer be adequate when traditional service providers are competing with virtual operators or virtual service providers who do not need to comply with the same rules in areas such as quality of service, spectrum licencing, local intercept laws and taxation. To enable operators to continue to sustain and build up services to meet customer expectations and national requirements, a level playing field must be established between virtual and physical industries in cross-border services.

New regulatory approaches

Highlighting the need for fit-for-purpose, flexible and future-proof regulatory frameworks to respond to the challenges of a digital transformation process catalysed by the COVID crisis, moderator Maddens asked panellists for examples of “5th generation regulation” – collaborative, partnership-oriented, evidence-based and agile.

Regulatory sandboxes have enormous potential to adapt and promote innovation by developing alternatives to traditional regulatory methods, explained Cortés. In Colombia, the current sandbox initiative focuses on social impact, prioritizing access in areas of low connectivity, as well as promoting competition and the use of new technologies and technological approaches. It includes guidelines and tools to help operators create relevant proposals, and is supported by public universities, drawing on external expertise in innovation processes beyond the normal remit of regulatory bodies. “The results of the sandbox process show that industry actors are really interested in innovation, and provide the regulator with confidence in promoting innovation and supporting telco evolution,” he concluded.

For Imedadze, unprecedented levels of interconnectivity represent opportunities for collaboration, with national regulatory authorities, policy makers, industry and citizens sharing active responsibility for ensuring a safe and secure digital society.

Regulators should act as facilitators in three key areas: providing clear legal frameworks to enable large players and SMEs to enter the digital market; establishing light touch policies for cross border collaboration with other regulators and administrations; and supporting SMEs with innovative models to foster new technologies. Upskilling is critical for regulatory bodies, too, enabling the regulator to understand sector developments, provide a government reference point on digital education and roll out cybersecurity and digital literacy programmes.

Regulators’ decisions impact on industry stakeholders, business and industry consumers and political stakeholders, explained Mote. He cited examples of encouraging stakeholder engagement in regulation in Mozambique, including assertive communication, where new legislation is discussed with all opinion makers, consultations are published and media briefings reach out to the wider public. This may equally involve deregulation, when existing regulation no longer matches market needs, as the sector adapts to the digital economy. Stakeholders also collaborate with other regulators and international organizations across borders to establish best practices.

For Velez, “transformation starts at home,” and governments themselves should digitalise to provide transparent communications and public services for citizens. “The most striking benefits of regulatory bodies transforming is that now public consultations and open dialogue exists between regulators, government, the private sector and industry,” she said. Regulators need to adopt a holistic approach, engaging with all stakeholders, technology providers, tower companies and mobile operators. The government has a key role to play in changing the narrative on health concerns such as fear of radiation by communicating with local communities, as well as developing models for municipalities to enable more efficient infrastructure deployment.

It is very important to strike a balance between the national development agenda and protecting consumer rights, pointed out Algibreen, as well as supporting investors or operators calling for more transparency and a more collaborative approach. Regulators must be assertive in issuing regulation to provide certainty and clarity so that the industry can grow.

Summing up

Regulators can act as facilitators, encouraging participatory regulation and balancing innovation with competition and affordability of services, emphasized de Regt.

“The regulatory sandbox is a testbed for promoting new innovative models that facilitate network deployment and promote access,” stated Cortés, and is particularly efficient when coordinated with public policy and other regulatory tools. Telecom regulators should take digital transformation very seriously and promote strategies to maximize social wellness, encourage investment and competition, “but we are convinced that an innovative regulator drives the sector’s technological development.”

Building digital trust and cooperation between different stakeholders are key for Jacobs, a view shared by her fellow panellists. “It is clear that we are no longer at the very beginning of the digital revolution but we have a tremendous amount of growth and opportunity ahead of us,” concluded Calabrese. “We have to cooperate to make sure we take advantage of these opportunities in a way that is secure and privacy protected.”

“Together, we can build a digital world for the future,” echoed Algibreen.

Industry regulators from across all continents are facing the same challenges – challenges which can only be met by collaborating and working together across sectors and government departments at local, regional and national levels.

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