Regulation and Investment for Network Development LIRNE asia

1. World Dialogue on Regulation for Network Economies (WDR)www.regulateonline.orgWDR Expert Forum and Research Workshop Regulation and Investment for Network Development LIRNEasia Colombo, Sri Lanka, 15-17 September 2004

2. Characteristics of 21st Century Network Economies & Information Societies • Driven by the services sectors • Founded on info/communication networks – next generation Internet; e-economies • Dependent on effective reforms in the telecom sector – information infrastructure • Strengthening links among local, national, regional, international networks and markets

3. Stages of Telecom / InformationSector Reform • Telecom Liberalization (participation, universal access) • Expanding Network Capacity (voice; broadband) • Preparing the Network Foundation for New Services • Developing New Services – Applications Everywhere • Applying Services Productively in Different Societies • Telecom Reform & Regulation – Key Driver for Implementing Policy Reforms

4. Technologies Markets Applications Services Regulations Policies Criteria for Economic Growth Policy & Regulation: Catalyst for – or constraint upon – development?

5. Progress with Telecom Reform • Now 120+ Countries with Separate Telecom Regulatory Authorities • WTO Commitments to Liberalization • Industry Specific Focus of Reforms • Successes, Failures, Unanticipated Difficulties, Continuing Delays • Telecom Reform is Proceeding at a Slower Pace than Technology Development or Market and Sevice Potential

6. LIRNE.NET Mission To facilitate institutional reforms for new "network" economies, by building human capital - through research, training and dialogue - as the foundation for effective policy, regulation, governance and management. Activities • External Training Initiatives (for Government, Industry and NGOs) • Research Activities and Reports • Expert Analysis & Commentary on Current Issues • World Dialogue on Regulation for Network Economies

7. LIRNE.NET www.lirne.net A Strategic Collaboration • Center for Tele-Information (CTI), TU Denmark • Economics of Infrastructures, TU Delft, NL • LINK Centre, Wits University , South Africa • Media@lse, London School of Economics, UK • LIRNEasia, Sri Lanka

8. WDR Mission to facilitate an international dialogue that generates and disseminates new knowledge on frontier issues in regulation and governance to support the development of networkeconomies

9. WDR Core Tasks • Dialogue on Interactive Web Site • Case studies & Research Reports • Forum Discussions among Experts • Wide Dissemination in Print and Electronic form

10. WDR Dialogue Theme 2001-2002 The Next Step in Telecom Reform: ICT Convergence Regulation or Multi-sector Utility Regulation? Report available on WDR website and in print.

11. WDR Dialogue Theme 2003–2004 Stimulating Investment in Network Development: Roles for Regulators Drafts of papers available on WDR website. Report to be finalized immediately after Sri Lanka Expert Forum. Available November 2004.

12. WDR Dialogue Theme 2004–2005 Diversifying Investment in Network Development Research and Dialogue now underway. See www.regulateonline.org, e-Briefs # 1, 2, 3.

13. WDR Institutional Partners 2004-2005 • infoDev, World Bank – Foundation Partner • IDRC Canada • LIRNE.NET Centres • Research Partner Universities • Others in discussion

14. Stimulating Investment in Network Development: Roles for Regulators Defining and Implementing Regulation to Faciltate Sector Investment in Network Development The Challenge – Creating regulation that: • Reduces rather than increases investment risk • Leads rather than lags technology and market developments • Provides a catalyst for investment and growth in network e-economies

15. Elements of Policy and Regulatory Risk in Information Infrastructure Development • Credibility – regulatory independence from political intervention on substantive issues • Credibility – Regulatory independence from incumbent monopoly power • Transparant processes • Accountability for performance • Competence and skills • Commitment to implement policy objectives • Evident fairness

16. 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

17. Regulatory Relations Affecting Sector Investment

18. Proactive Policy & Regulation • 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 transparant and credible

19. There is nothing more difficult to plan,more uncertain of success, or more dangerous to managethan the establishment of a new order of government;for he who introduces it makes enemies of all those who derived advantage from the old order andfinds but lukewarm defenders among thosewho stand to gain from the new one.(The Prince, by Nicolo Machiavelli, 1513, p. 27)

20. World Dialogue on Regulation for Network Economies • Participate in the Dialogue; review and comment on the research, www.regulateonline.org • For more information contact, Merete Henriksen, WDR Coordinator, henriksen@lirne.netTel. + 45 4525 5178; Fax + 45 4596 3171 LIRNE.NET, www.lirne.net • A Strategic Collaboration for applied research, training, policy and regulation support, relating to information infrastructure and new network economy development • Center for Tele-Information (CTI), TU Denmark • Economics of Infrastructures, TU Delft, Netherlands • LINK Centre, Wits University , South Africa • Media@lse, London School of Economics, UK • LIRNEasia, Colombo, Sri Lanka