Open Systems in Digital

Convergence
Ir. Muhamad Asvial, MSc., PhD
Electrical Engineering Department - University of Indonesia
E-mail: asvial@eng.ui.ac.id

Slide 1

Opportunities: Paradigm Shifts

• Static market • Dynamic, fast-
environments paced innovation
• “Divergence” • “Convergence”
• “Circuit-switched • Packet-switched
• Local TO • Global
• Low-speed • High-speed
• Switch-on • Always-on
• Fixed • Mobile + Fixed
• Single medium • Multi-media
• Distinct • Bundled

Slide 2

1
 Trend of Telecom Convergence
Convergence of new technologies actually bring convergence to
services and contents

Wireless From fixed to

From mobile to wireless
wireless
PC/WLAN

Celluar/Wifi handsets

ADSL
Voice Voice
Convergence
Mobile

Fixed
to services
and contents
Data Data

Mobile evolution from 2G to 5G Cable modem/setup box

Contents

TV

3G Broadcast
From analog to digital,
Slide 3 e.g., DAB/DMB

Challenges: Digital Convergence

• Institutional challenges: convergence of ministries,
regulators etc. in telecom spectrum, IT/ICT,
broadcasting, which is often a political issue.
• Regulatory & legislative challenges: difficulties to
catch up technological innovation and convergence
in the converged laws/regulations.
• Industrial challenges: balance between creating new
employment and redundancy as well as convert from
legacy networks/technologies to the converged ones
with huge costs especially for the developing
countries.
Slide 4

2
 Challenges: Convergence
• Pricing: Will offer prices that are significantly lower than
those available today?
• Bundling and billing: How to distinguish real price of
bundled services?
• Interconnection: Will current interconnection models
(based on per-minute settlement) work ?
• Security: If much greater capacity is available at the
edges of the network, how to guarantee security?
• Investment: Will unbundling discourage new
infrastructural investment?
• Traffic prioritization: Is the Net really “neutral”?
• Emergency services: What level of universal service
obligation to impose?
• Competition policy: Significant market power will not go
away in the converged (e.g., NGN) environment ?
Slide 5

ITU’s mandates in digital information society

• ITU-R: allocation for the appropriate
frequency/spectrum for the converged technologies,
networks and services, and develop technical
standards for radio access and other radio
communication services.
• ITU-T: set international standards (i.e.,
Recommendations) to ensure interoperability, security
etc. in the converged telecoms/ICts, bridge the
standardization gap.
• ITU-D: assist members in developing and moving
towards the converged telecom/ICT environment
through providing expert support, trainings to
equipments/facilities.
• Closer collaboration between the three ITU Sectors.

Slide 6

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

Slide 7

The Dimensions of Convergence on

the Information Infrastructure

Convergence Sectors Drivers of Convergence Applications

• Finance
Computing •Technology
• Commerce
• Industry-Supply
Content
• Market-Demand • Education
• Policies/Regulation • Health
•Industry Specific • Publishing
•Convergent
Telecom • Manufacturing
• etc.

Slide 8

4
 Policy, Regulation and Network
Investment

• Licensing - paying for the privilege

• Annual Fees and charges
• Restrictions on investment opportunities
• Price and/or profit regulation
• Policy & regulatory risk

Slide 9

Unresolved Network Market Issues

• Public Resource Infrastructures for Telecom

Networks - Rights of Way, Spectrum, Numbers,
Names
• Interconnection
• Termination Number Monopolies
• Access Limitations in the Face of Positive
Externalities
• Leverage Opportunities for Monopoly Nodes in the
Network
• Achieving Faster Infrastructure Network Development

Slide 10

5
Elements of Policy and Regulatory Risk in
Telecommunication Infrastructure
Development

• Credibility – regulatory independence from political

intervention on substantive issues
• Credibility – Regulatory independence from
incumbent monopoly power
• Transparent processes
• Accountability for performance
• Competence and skills
• Commitment to implement policy objectives
• Evident fairness

Slide 11

Shifting Policy/Regulatory Priorities to

Stimulate Investment

• From supply of network facilities to stimulation of

demand to justify investment
• From physical capital to human capital
- awareness, skill, capabilities
- applications by individuals & organisations
• Diverse sources of private and public investment
- operators, service providers,
- intermediaries (e.g., Telecentres), user applications

Slide 12

6
 Regulatory Relations Affecting Sector
Investment
Supply Telecom/ICT Demand/
Sector Need

Services Intermediaries

Regulation

Facilities End Users

Public Resources Applications

Policy

Slide 13

Proactive Policy & Regulation for

Implementing Convergence Opportunities

• Create a favourable investment environment

for physical & human capital
• Minimize barriers to participation
• Facilitate demand as well as supply
• Apply skills and strategic management to
achieve the spirit of the policy objectives
• Can only be done if regulatory structure is
transparent and credible

Slide 14