Rethinking universal access

New technologies offer new ways to connect

It is a timely moment for regulators to review the mechanisms they rely on to reach their universal access goals, given the transition to next-generation networks (NGN). This is a conclusion of ITU’s latest report, Trends in Telecommunication Reform: The Road to Next-Generation Networks (see also Global trends in telecommunications). It says that both developed and developing countries must reconsider their policies and regulations on universal access if they are to meet the connectivity targets of the World Summit on the Information Society (WSIS) by 2015.

According to ITU indicators, the global telephone penetration rate (fixed and mobile combined) was some 60 per cent at the end of 2006. Internet usage was around 17 per cent. The new report stresses that regulators "should focus first and foremost on sector reforms that allow market forces to play a greater role in achieving universal access". It says that NGN should be seen as a tool for meeting the WSIS goals (see box), because they can provide a wide range of services essential for development, including e-government, e-health and e-education. NGN promise "to reduce poverty and promote socio-economic growth by integrating more communities into the global economy," provided that appropriate policies are in place, says the report.

What is included?

While there is a common understanding of the underlying aims of universal access programmes, there is no single definition of what commitments they should include. Beyond the general goals of promoting availability, affordability and accessibility to information and communication technologies (ICT), universal access definitions vary from country to country.

In the European Union (EU), for example, Member States should provide basic telecommunication services at a defined quality and an affordable price. These services include connection to the public phone network at a fixed location, supporting speech and data communications at rates sufficient for access to online services, directory enquiries, provision of public payphones, and facilities for people with disabilities.

The inclusion of data services in definitions of universal access is relatively new. A decade ago, the definition in most countries covered only fixed-line infrastructure. Today, there are many means of communication and various types of infrastructure must be deployed in the most effective way to reach target populations.

Malaysia provides an example of this process. The Malaysian Communications and Multimedia Commission specifies the number of residential or public phone connections that are required — but not which technology should provide them. Under this technology-neutral framework, companies bid to offer the service using various solutions, ranging from the provision of mobile satellite phones to the deployment of CDMA wireless local loop networks.

The role of mobile

Because of its availability, affordability and convenience, mobile telephony has produced in less than a decade the same impact that fixed-line phones achieved in a century. It is estimated that mobile coverage extends to more than 80 per cent of the world’s population (see article Connecting everyone by mobile phone). The new ITU report underlines that "universal access programmes that are concerned with voice services should bear in mind these market realities and avoid investing scarce resources in alternative network deployments where mobile services can be expected to serve the market without subsidy".

The introduction of 3G CDMA450 technology offers a new way to use mobile technology to provide universal access. By transmitting at a lower frequency, the technology allows for large cell sizes. In turn, this means reductions in installation costs as fewer base stations are required. It also supports the high-speed transmission of data.

A number of countries have already deployed CDMA450 as part of their universal access programmes. One of them is Peru, where rural operator Valtron became the first commercial CDMA450 network operator in Latin America in June 2006. Operating under the name Televías de Huarochirí, Valtron will provide fixed, mobile, public telephone, Internet access and cable television services to 127 low-income towns in the province of Huarochirí in the Andes. The 10-year project has a goal of reaching 38 000 direct, and 59 000 indirect, subscribers.

Wi-Fi around the world

Technological innovations associated with the transition to NGN are already transforming the way universal access is being extended to rural and remote areas in both developed and developing countries. To a large extent, this transformation is being fuelled by new broadband wireless access technologies, such as WiMAX and Wi-Fi.

Mesh networking in the Amazon basin

Wi-Fi networks can be deployed even in the most isolated areas, using mesh network architecture. For example, Yachana in the Amazonian region of Ecuador is 2.5 hours by motorized canoe from the nearest town. The Foundation for Integrated Education and Development (Funedesin), a non-governmental organization dedicated to community development, has deployed a wireless mesh network to connect a school to an ecotourism centre and a bioscience centre. The Wi-Fi mesh is connected to the Internet via a very small aperture terminal (VSAT) link, and meshboxes and laptops employ solar power. Voice over Internet protocol (VoIP) is used within the network and to link users to the PSTN. Supported by the revenue it gains from tourists, Funedesin is setting up a college nearby to train others in mesh networking.

Citywide networks

Citywide Wi-Fi networks are becoming more common. But while Wi-Fi access equipment is affordable for end users, it is costly to deploy, operate and maintain large Wi-Fi networks. Philadelphia in the United States, for example, estimates that it will spend USD 10 million on its citywide Wi-Fi network over the next several years. In 2006 alone, local governments around the world were estimated to have spent USD 235 million to build and operate these networks. By 2010, it is estimated that more than USD 3 billion will be spent. Although still expensive, these systems can quickly expand Internet access in urban areas.

Surfing for free in Singapore

Since the start of 2007, Singaporeans have been enjoying free wireless connectivity at speeds of up to 512 kbit/s almost everywhere in the country, under a programme known as "Wireless@SG". The programme was initiated by the Infocomm Development Authority of Singapore (IDA) and is run by three private local operators. It aims to increase the number of public Wi-Fi "hotspots" in the country from 900 to about 5000 by September 2007. Users do not have to be subscribers of these operators to enjoy the free access. The three operators are investing around USD 65 million to extend the network, with IDA defraying around USD 19 million of that amount.

Should broadband be universal?

Global broadband penetration rates seem to indicate that broadband Internet access is not yet so widespread that people without it could be considered "excluded". At the end of 2006, only 4.3 per cent of the world’s population had broadband. Even in countries that lead the field, such as the Republic of Korea, penetration rates only just exceed a quarter of the population.

However, the question of whether broadband connections should be included in universal access obligations assumes greater importance with the advent of NGN. Services such as high-quality VoIP and streaming video can only be delivered through broadband networks. Several developed countries are considering making it compulsory to provide broadband access to all households as part of universal access, to avoid excluding people from its social and economic benefits.

Already, in Switzerland, the Federal Communications Commission (ComCom) has designated Swisscom as the universal service licensee from 1 January 2008. The new licence obliges Swisscom to provide a broadband Internet connection, in addition to analogue and digital telephone connections, as part of universal service obligations (see box). All sections of the population must be covered and all regions of the country.

Better management of spectrum

The ITU report on Trends in Telecommunication Reform says that while universal access programmes are useful in providing ICT services to the underserved, they are not a substitute for continuing reform. "Liberalization and competition have brought far greater benefits over the past few years than decades of universal access efforts channeled through monopolies. As such, regulators and policy-makers have to look at other areas of regulation that play a vital role in supporting the expansion of ICT access", the report says.

Allowing licence-free spectrum use

The growing popularity of mobile services and the introduction of new wireless technologies have dramatically increased the demand for spectrum. As a result, countries are looking at new ways to manage spectrum use more efficiently. Growing amounts of spectrum are being allocated to licence-free use worldwide, in order to exploit the potential of technologies such as Wi-Fi and WiMAX to propel the rapid expansion of affordable high-speed access in rural and urban areas.

But not all countries have embraced the idea of allocating spectrum for licence-free uses, due to fears of revenue losses or congestion. "These fears, however, do not appear significant when compared to the potential of Wi-Fi and WiMAX to provide cheaper access," says the report. Any losses from foregoing licence fees would be offset by substantial savings in subsidies for universal access programmes. In addition, options such as attaching a small fee to the cost of buying equipment used in unlicensed spectrum (such as Wi-Fi routers) could obviate the need for a licence to operate in a particular frequency band while still providing revenue to the government.

Issuing rural spectrum licences

As a general principle, regulations should reflect the differences between urban and rural markets. With spectrum congestion being less of a concern in rural areas, spectrum licences should be awarded more cheaply, or even licence-free in certain bands. This would substantially reduce the cost of building wireless networks in rural areas.

In many countries, spectrum management leaves many rural providers with mediocre spectrum while frequencies with much better propagation characteristics remain idle because they are allocated to urban areas. This shows the shortcomings of a uniform approach and the need for spectrum managers to recognize the differing conditions for city and countryside.

Burdensome licensing

The report also notes that high licence fees are a significant barrier to investment, particularly for small operators and those serving rural areas. A simplification of the licensing process and a reduction in fees would alleviate the situation. For example, regulators could designate specific areas where operators would face minimal regulation, apart from obtaining authorization and ensuring against interference with other users.

Market mechanism

The ITU report concludes that greater reliance should be placed on market forces in the provision of universal access. It recommends that "a systematic review of a country’s universal access policies should first and foremost include a revision of its sector policies and regulations concerning licensing, spectrum management, interconnection, VoIP and price regulation, with a view towards lowering barriers to market entry in rural and remote areas". It adds that "intervention by regulators and policy-makers in the form of universal access funding should only be attempted where there has been a clear failure of market forces in meeting universal access goals".