Telecoms Players Should Be Concerned about Regulation, Says Analysys

Business Wire, March 11, 2008

CAMBRIDGE, England -- Current telecoms regulation may be unsuited to overseeing and encouraging the construction of next-generation network architecture, according to a new report, Regulatory Headaches in the Transition to Next-Generation Networks, published by Analysys, the global advisers on telecoms, IT and media (http://research.analysys.com). The converged multiservice fibre and IP/Ethernet based next-generation architecture is both a huge investment and a major change for the telecoms industry, and put new stresses on the nature of competitive telecoms service provision.

"The next five to ten years or more will present regulators and the industry with some difficult and fundamental issues, and some regulatory decisions will have a correspondingly difficult and fundamental effect on some players and their business models," says the report's co-author Tim Hills, Analysys Associate. "Players of all types should therefore be very concerned about the increased potential of regulators to adversely affect their businesses."

Current telecoms regulation has been designed largely to introduce competition into an existing and relatively stable industry environment that has benefited from decades of now sunk investment costs. However, in the initial and rapid transition to next-generation architecture, the report finds that three very broad, but fundamental, areas of regulatory concern are emerging.

* Encouraging next-generation investment in the face of huge costs and uncertain rewards in a competitive environment.

* Handling the consequences of fully converged services that bring together historically separate industries and players, such as telecoms, media, Web 2.0 companies and applications providers.

* Supporting general policy and socio-economic goals as next-generation architecture becomes an increasingly critical element of national infrastructure and source of national services.

The new report examines some of the steps that regulators might take to address specific issues in these areas, and how these steps might, in turn, affect the players in the market. It suggests that regulators need to revisit the notion of competition in telecoms in order to decide on what degree and type of competition they wish to see emerge in the next-generation environment.

The report is available to purchase online at http://research.analysys.com/store, priced at GBP1700 (approximately EUR2550) plus VAT.

For more information, telephone the press office on 44 (0)1223 460600 or email research@analysys.com or press@analysys.conm for a copy of the report's executive summary.