enabling-regulation:overview

Enabling Regulation

Although the business models of national operators and local commercial operators providing connectivity are fairly well understood, less is known about local social-purpose operators and their role in providing affordable access to communication in places where the commercial operators see no interest. Among them, a number of community-owned networks have demonstrated their ability to contribute to closing the rural access gap. This is being increasingly recognised in the outcomes of many international fora on connectivity gaps, as shown in the Recognition in Policy documents section below.

There are a variety of barriers that local social-purpose operators face because most regulatory frameworks have been designed primarily to cater for national operators deploying their own infrastructure. This wiki presents an analysis of solutions that have been implemented by regulators worldwide to address the key barriers faced by local operators, grouped in the following categories:

Regulatory interventions identified in these five areas are making it more possible for local operators to provide coverage in places where there was none, as well as considerably more affordable telecommunication services in areas where users do not have the disposable income to afford the data packages available from national operators.

Based on this evidence, this paper concludes with a set of recommendations for regulators wishing to create a more enabling environment for local operators by replicating and localizing the best practices included in this document.

A more inclusive telecommunications ecosystem can be achieved through the creation of a tiered licensing framework that caters for the needs of operators of all sizes. Such a framework would include categories for local commercial operators and SMEs, which would be associated with a more modest fee structure and lower administrative burden. Additional exemptions may be extended to local social-purpose operators and those wishing to provide affordable access in localized geographical areas and communities and on a not-for-profit basis.

Below there is a summary of the major challenges identified, the proposed solutions, and the countries where they have been implemented.

Challenge Solution Example
Licenses of National/Regional Scope More granular approach to licensing South Africa, Brazil, Kenya1)
High initial and annual fees and onerous compliance requirements License Exemptions for private networks and non-profits Brazil, Mexico, South Africa
No specific licence for community networks Create specific licenses for Community Networks or fitted in existing exemptions. Argentina, Uganda
High administrative burden on regulator Simple authorization or notification system Canada, New Zealand, U.S.A, European Union

Provision of affordable connectivity to the half of the world that still lacks access to the internet will mostly take place via wireless networks. As a result, the regulation of access to spectrum is a critical issue. Although there are innovations in spectrum management taking place around the world1), adoption of these innovations has not kept pace with the growing need for affordable access solutions to create a more inclusive internet.

In terms of ensuring that all citizens are within reach of a wireless signal, regulatory challenges regarding spectrum are related to the development of innovative mechanisms to allow access to spectrum in fair terms for those operators willing to attend uncovered areas. Countries have developed different approaches summarized in the following table.

Challenge Solution Example
Performance of license exempt spectrum (2.4GHz and 5.8GHz) is degrading as the frequencies become more crowded Make more license exempt spectrum available United States: The FCC recently designated 1200MHz of spectrum in 6GHz for license exempt use2)
Assigned IMT (mobile) spectrum remains underutilised in rural areas. Set aside IMT spectrum for rural connectivity Mexico: Set aside 10MHz in the 850MHz band to allow the indigenous operators to connect communities below 3000 inhabitants
Establish use-it-or-share-it mechanisms for IMT licenses UK: Small and rural operators can apply for a license in secondary use in areas of no interest for big operators3)
Rural wireless backhaul requires cost effective solutions Implement dynamic spectrum sharing regulation U.S, U.K., Colombia2), South Africa3), Mozambique have implemented TVWS regulations with Nigeria4), Kenya5), and Uganda6) soon to follow. The U.S. is implementing dynamic spectrum regulation in 3.5GHz7)
Implement light-licensing regulation for microwave US8) and New Zealand9) have implemented simple authorization mechanisms for the issuing of licenses for Point to Point use in 11GHz
High recurring fees for spectrum Consider fee exemptions for social-purpose licensees Mexico establishes spectrum fee exemptions for indigenous operators10)

Due to the potential for interference when two operators use the same frequency, the use of most radio spectrum requires a license. However, the rapid spread of license-exempt spectrum use in the form of WiFi, the technology of choice for many local operators, is an important lesson about the power of frictionless innovation and about the pent-up demand for affordable internet access. It makes sense for regulators to leverage this success by expanding access to license-exempt spectrum and further reducing costs and bureaucracy associated with its use. In addition to the traditional WiFi bands in 2.4 and 5 GHz, some countries are incorporating new license-exempt bands in their Radio Frequency Plans, such as 6, 24 and 60 GHz. The Federal Communications Commission in the U.S.A. is leading the way in substantially expanding frequencies license-exempt use11).

While demand for spectrum for International Mobile Telephony (IMT) often exceeds the pace at which regulators are able to make it available in urban areas, large amounts of licensed spectrum lie unused in sparsely-populated, economically poor regions. For example, the purple circles in the figure below shows the regions in Nigeria where LTE mobile network operators are providing coverage12). The map also displays population distribution data based on the High Resolution Settlement Layer (HRSL) data research by the Earth Institute13). As can be seen, the total coverage of the land area and populations within the LTE signal footprint is still relatively small. For illustration, the blue circle with the pop-up dialogue within the image, which has a radius of 10 km, contains nearly 50,000 people living where none of the LTE operators in the country are using their spectrum.

Sample image from GSMA Mobile Coverage Maps

There is an opportunity for innovative approaches to reuse this spectrum to provide affordable access for all. As indicated in the section above, a variety of low-cost IMT base station manufacturers have emerged in recent years that offer the potential to dramatically change the cost model for sustainable rural mobile network deployment. Incumbent operators may not see sufficient return on investment to justify the roll-out of these new technologies. Yet, because regulation focuses on national operators, local operators, who do have that potential, are currently excluded from access to the radio spectrum required to deploy networks that could directly reach handsets already available in these areas. To address the under-use of assigned spectrum in rural areas, a strategy is needed to enable sharing of unused IMT spectrum that has already been assigned to a primary licensee. In addition to this, in many countries, there are still many blocks of IMT spectrum that remain unassigned. Evidence has shown that when IMT spectrum set-asides for social use of this bands are created, such as the case of Mexico, local social-purpose operators provide affordable mobile services in places of little economic interest to national operators. Regulators aiming to address digital exclusion may want to consider setting aside small spectrum blocks of IMT spectrum for local operators wishing to provide affordable connectivity in underserviced areas. Similarly, they may consider use-it-or-share-it provisions when preparing new IMT spectrum bands for allocation and assignment. Alternatively, an effective strategy may be to allocate this new spectrum to smaller regions than nationally, or to allocate IMT spectrum dynamically on a secondary-use shared basis to prevent it lying unused where the need for affordable access solutions is greatest. Countries such as the United Kingdom have already pioneered these approaches.

The reduced interference from antennas designed for Point to Point (PtP) links that can focus wireless communication along very narrow beams/paths has also led some regulators to extend the use of bands traditionally assigned for satellite services, for PtP backhaul links. Additionally, powerful, low-cost microwave technology pioneered by WiFi manufacturers can be used in almost any frequency band. Some countries are benefiting from the market availability of low-cost microwave solutions in 11GHz and other frequencies, and have adapted the regulations to encourage their uptake. This has taken the form of a light-licensing scenario such as is operated in the United States and in New Zealand for the cooperative assignment of geo-located frequency assignments.

The high cost of exclusive-use spectrum licenses, particularly through spectrum auctions, stands in stark contrast to license-exempt spectrum that is available at no cost. Dynamic spectrum management, which assigns spectrum on an on-demand basis, offers the opportunity to establish a middle ground between both approaches. While TV White Space (TVWS) regulation has been implemented in the United States, the United Kingdom, and Singapore, its real potential may yet to be realised as an affordable access technology in developing countries where spectrum in the UHF band is largely unoccupied, especially in rural areas. In the Global South, Colombia, Mozambique, and South Africa are pioneers in this regard, having recently introduced TVWS regulatory frameworks aimed at exploiting the technology for addressing digital exclusion.

Spectrum usage fee calculations vary from country to country. In most cases it is determined by a formula that considers a combination of parameters, including size of the spectrum block being assigned, the centre frequency (value of that particular spectrum band), and the type of application (point to point - backhaul - vs access). Some countries have come up with more innovative formulas that make more fine-grained calculations, with parameters such as the size of the area being covered, and whether the area is urban or rural or whether the spectrum is shared. This allows the same formula to generate modest fees for a small, rural, local network, while, while exclusive, national use of spectrum would entail sums of the order of magnitude that national governments would like to see collected from the telecommunications industry.

Another issue for consideration is whether local social-purpose operators such as Community Networks should be exempted from spectrum fees. In 2019, the Mexican social-purpose operator, TIC AC, challenged attempts by the national regulator to levy spectrum fees on spectrum that has been assigned to them for social-purpose use. TIC AC were successful in their challenge with the result that spectrum fees do not apply to indigenous operators using social-purpose spectrum. These provisions will further ease the provision of access in unserved areas.

Challenge Solution Example
Financial infeasibility of backhaul for local operators, due to lack of coverage or unaffordable capacity pricing Deploying wholesale open-access network Public Wholesale Network: Stokab, Sweden4); NTB, Uganda; GUILAB, Guinea

Private Wholesale Network: CSquared, Uganda, Ghana and Liberia5)
Impose non-discrimination and access obligations on network elements and associated facilities for interconnection, and fair and cost-based pricing, including pricing transparency (published prices), and distance-independent pricing Benin, Côte d’Ivoire, Niger
Make low-cost satellite capacity available to local operators Mexico
Allow national research and education networks to provide backhaul services to local social-purpose operators Argentina, Kenya, South Africa
Barriers to deployment from private land and building owners Rights of way for the common good in national law and municipal ordinances to regulate deployments, including price caps on rental fees European rights of way regulations, South Africa
Infrastructure sharing and dig-once policies EU cost reduction directive, mandatory dig-once rules in many European countries
Policy for sharing by default, oriented to reduce cost and prevent duplication; mandate to incorporate ducts for telecom operators Cost-sharing directive across EU Several municipal and regional regulations in Spain
Lack of access to numbering and voice interconnection Interconnection regulations ensure local operators can have access to numbering resources at cost and to asymmetric voice termination rates in their favour Asymmetric interconnection tariffs are well known as a means to help ensure the viability of small rural operators. In South Africa for operators with less than 20% market share this applies for the first four years.
Challenge Solution Example
Public Financing Non-recoverable subsidies, non-repayable contributions by public administrations Universal service funds, least cost subsidy auction
Public incentives to promote private investment Tax deductions for economic donations to public interest infrastructure Infrastructure (CAPEX) donation to the guifi.net Foundation results in 35-75% tax deduction from the Spanish government (tax office)14)
Financial risks in infrastructure deployment Public administrations financing initial deployments Xafogar fibre deployment in Spain
Investment from public banks Global, regional, national whole- sale and public banks National development banks, World Bank and IFC, combined with retail banks such as ethical banking, private lenders, interested in impact investment
Challenge Solution Example
Local operators and digital advocacy organisations are unable to discover the extent to which IMT frequencies have been assigned. Standardise good practice of making all IMT spectrum assignments and details of licence fees and obligations publicly available on regulator websites. Nigeria15), UK16)
Coverage maps from mobile operators are not subject to any independent verification. Coverage gaps and opportunities may be understated. Standardise the good practice of making data on all tower and radio operation publicly available. Canada, Netherlands17)
Absence of public data on all national fibre networks hampers strategic planning by national and local operators. Obligate all fibre operators to publish publicly available network maps including points of presence. France, Ireland18), Dark Fibre Africa19), South Africa

One of the main barriers to the adoption of an enabling regulatory framework for local operators is that few people know they even exist. This applies not only to the rural communities that are most likely to benefit, but also to policy makers and regulators, and development organisations. Lack of awareness is compounded by the view among most policy makers and funders that access markets can be sufficiently well-served by a handful of large (multi)national operators competing to provide services of sufficient coverage and quality, and at an affordable price. However, there is an increasing body of experience that indicates that support expanding the telecommunications operator ecosystem to include local operators.

A number of global policy positions have now reached similar conclusions. Among them:

ITU-D: Telecommunications for rural and remote areas - The World Telecommunication Development Conference (Dubai, 2014) Recommendation 19

Recommendation 1920) includes the following:

10. that it is important to consider small and non-profit community operators, through appropriate regulatory measures that allow them to access basic infrastructure on fair terms, in order to provide broadband connectivity to users in rural and remote areas, taking advantage of technological advances;
11. that it is also important that administrations, in their radio-spectrum planning and licensing activities, consider mechanisms to facilitate the deployment of broadband services in rural and remote areas by small and non-profit community operators;

UN Ecosoc WSIS resolution 2019

Numeral 5421) includes “Community Networks” as an emerging topic.

The Report of the United Nations Secretary General’s High Level Panel on Digital Co-operation

The report 22) states that:

Governments have an important role to play in creating a policy framework to enable private sector enterprise, innovation, and cooperative, bottom-up networks (page 12)

and concludes in its recommendations that:

Second, investments should be made in both human capacity and physical infrastructure. Creating the foundation of universal, affordable access to electricity and the internet will often require innovative approaches, such as community groups operating rural networks, or incentives such as public sector support. (page 29)

The Annual Deliverable 2019-2020 from ITU-D Study Groups Question 5/1: Telecommunications/ICTs for rural and remote areas

The report includes23):

the following recommendations can be made for now:
  • Ease regulatory requirements for community network operators.

COVID-19 Response Statement from the G20 Virtual Ministerial Meeting on April 30, 2020

The response includes24):

Furthermore, digital capacities should be expanded, in particular by increasing broadband connectivity using fixed, mobile, and satellite technologies and by exploring non-traditional means of connectivity,such as community networks.

Other ITU documents

Aside from the Annual report mentioned above, here are other ITU documents produced in 2020 that mention community networks on several occasions. These include:

  • ITU Smart Villages Blueprint25)
  • ITU-D Last Mile Connectivity Guidelines26)

Africa

In Africa, the Specialized Technical Committee on Communications and Information Technologies (STC-CICT) from the Africa Union included, in its 2019 Sharm El Sheikh Declaration (STC –CICT-3) the following text directing the African Union Commission to:

29. PROMOTE the formulation of strategy and pilot projects for Unlocking Access to Basic Infrastructure and Services for Rural and Remote Areas including Indigenous Community Networks, and develop guidelines on legislation on deployment of technologies and ICT applications, to accelerate infrastructure role out in collaboration with ATU and other regional institutions;

Additionally, the Broadband Commission “Connecting Africa Through Broadband: A strategy for doubling connectivity by 2021 and reaching universal access by 2030” recognizes the role of community networks in 3 of the 7 Objectives of its Action Plan. Of particular interest is Objective 5:

Provide direct funding support for extending affordable broadband access to commercially challenging rural and remote areas, to women, and low-income users

and the recommendations under Objective 1 “Ensure that the commercial broadband ICT market is open and structurally prepared for competitive private investment“:

Adopt open wholesale and retail telecommunications market entry policies, especially competitive and unified licensing regimes, and liberal, dynamic spectrum policies. Such policies should also accommodate community and nonprofit focused network operators who offer services in underserved areas.

Americas

In the Americas region, the Inter-american Telecommunications Commission tracks the implementation of resolution ITU D-19 regarding small, not for profit and community operators, through resolution 268-PCC1. The report27), presented in 2018, shows the development of inclusive regulation for small and community operators in each of the countries.

Asia

In Asia Pacific, community networks are a relatively new topic. Still, they were discussed in 2019 at the Third Session of the Asia-Pacific Information Superhighway Steering Committee and WSIS Regional Review and included in its deliberations28).

Maybe a table and to be added to similar to the others

In addition some countries include in their policy documents references to community networks, small operators and co-operatives as a vehicle for digital inclusion. Among them, Kenya and South Africa. Kenya highlights the need to provide for enabling policy and regulatory framework for community-based operators in their National Broadband Strategy. South Africa not only mentions them in their National Broadband Plan, and includes them as part of the Telecommunications Value Chain in their SMME Strategy, but the development and promotion of “SMMEs and cooperatives” is part of the objects of the Electronic Communications Act, the main act of the telecommunications sector in the country. In the particular case of community networks, specific support for their development was articulated in the Budget Speech 2018 from the Department of Telecommunications and Postal Services. Unsurprisingly, South Africa is the country in Africa with the most local operators in Africa.

  • Kenya National Broadband Strategy 201829)
  • South Africa Connect: Creating Opportunities, Ensuring Inclusion. South Africa's Broadband Policy 20 Nov 201330)
  • Draft Information and Communication Technology Small, Medium, and Micro-Enterprise Support Strategy 31 Mar 201731)
  • Electronic Communications Act, 2005 (Act No. 36 of 2005)32)
  • Deputy Minister Stella Ndabeni-Abrahams: Telecommunications and Postal Services Dept Budget Vote 2018/1933)

In the Americas region, during the last few years, Brazil has implemented a strong policy and regulatory strategy for facilitating the participation of small operators in serving rural and remote areas, including a recent note on how to regulate community networks. In Mexico, community and indigenous operators are specifically recognized in the Telecommunications Act, and it specifies that spectrum planning activities should always take into consideration the specific needs of these operators. Mexico’s new Social Coverage Program specifically refers to them as an important allies in addressing unconnected areas.

  • Expansion of Brasilian Broadband Network Document presented by the Brasilian Delegation at the 35th Meeting of the PCC-1 Citel 2019.34)

Data Enquiry - Competition Commission South Africa 201936). Many references to community networks in the entire network, and a particular recommendation in page 32

“That ICASA consider models and regulatory changes to allow at least non-profit community networks, and possibly small commercial enterprises to access licensed spectrum not used by mobile operators in rural areas in a similar manner to television white space.”

14) Tax system for donations, gifts and contributions made in favour of foundations to which the tax system provided for in Title II of Law 49/2002 http://intranet.fundaciones.org/EPORTAL_DOCS/GENERAL/AEF/DOC-cw5565970265664/InformaciOnfiscalparadonantesdeduccionesnuevas.pdf
15) Nigerian Communications Commission - Frequency Assignment Tables - https://ncc.gov.ng/technical-regulation/spectrum/frequency-assignments
17) Netherlands - Regulation of public antenna register https://wetten.overheid.nl/BWBR0027031/2013-03-15
18) Open EIR - Rollout Map - https://fibrerollout.ie/rollout-map
19) DFA Public Network Coverage https://dfafrica.co.za/network/coverage/
22) The Age of Digital Interdependence, Report of the UN Secretary-General’s High-level Panel on Digital Cooperation https://www.un.org/en/pdfs/DigitalCooperation-report-for%20web.pdf
26) https://www.itu.int/md/D18-SG01-C-0362/en Note that accessing this document requires TIES access at the moment, please get in contact with itu@apc.org to request access
31) Draft Information and Communication Technology Small, Medium, and Micro-Enterprise Support Strategy https://www.dtps.gov.za/images/phocagallery/Popular_Topic_Pictures/40756_31-3_TeleComPostServ.pdf
33) Deputy Minister Stella Ndabeni-Abrahams: Telecommunications and Postal Services Dept Budget Vote 2018/19 https://africanewswire.za.com/deputy-minister-stella-ndabeni-abrahams-telecommunications-and-postal-services-dept-budget-vote-2018-19/

1)
Telecommunications Market Structure Under The Unified Licensing Framework 2017 https://ca.go.ke/wp-content/uploads/2018/03/New-Market-Structure-Under-The-Unified-Licensing-Framework-February-2017.pdf Accessed on 21 Aug 2020. Local copy.
2)
Unlicensed Use of the 6 GHz Band - April 24, 2020 - https://docs.fcc.gov/public/attachments/FCC-20-51A1.pdf
5)
CSquared home page https://csquared.com/
  • enabling-regulation/overview.txt
  • Last modified: 2020/10/07 16:22
  • by steve