Next-gen networks need tiered, converged rules

As momentum for next-generation networks picks up, this new ecosystem needs blend of differentiated and converged regulations, says consultant.

SINGAPORE--Government policy, which will play an important role in the deployment of next-generation networks (NGNs), needs to be a blend of differentiated and converged regulations, according to an industry consultant.

NGNs essentially carry market models--both monopolistic and competitive--previously demonstrated in the telecommunications industry, Jonathan Dharmapalan, managing partner at Ernst & Young's Global Telecommunications Center, said Wednesday at the Next-Generation Broadband Forum, held as part of imbX 2009.

Passive monopoly, Dharmapalan explained, is evident in how the infrastructure layer of NGNs operates, while a free, competitive market drives the services layer.

With the new multi-tier network infrastructure, he underscored the need for differentiation in regulations. "The way you regulate a monopoly or duopoly is very different from the way you regulate multiple services providers," he said.

A data compiler or processor, for instance, will require regulators to consider privacy issues such as the kind of user data that can be collected.

The Beijing-based consultant added that regulators need to consider "some level of converged regulations [to manage] converged players" brought about by the new environment.

There may be current regulations that apply to different industries or govern specific activities, such as telecommunications, e-commerce or finance, but these "don't necessarily talk to each other", he noted. But, such regulatory silos will rapidly disappear, said Dharmapalan.

Regulators will need to keep up with market developments to prevent faults in the system from being exposed, he urged.

"As you create the capability [for new possibilities], you're also creating the capability for use and abuse," he explained. Financial services, for example, reached a level of efficiency that made it possible to provide credit where there was no equity. However, this system was also abused, resulting in the financial crisis, he said.

Dharmapalan said convergence in regulations to address abuse "has not happened yet", and urged regulators to "start thinking about it now".