Briefing on WCIT-12 November 28, 2012 Inês Nolasco Cullen International provides reports and cross-country benchmarks on regulatory developments in the telecommunications, media, electronic commerce and smart energy sectors. Our services currently cover Europe, Latin America, Middle East and North Africa. We are widely recognised and trusted for our objectivity, accuracy and independence. Find out more about our services here. WCIT-12: countries divided on approach to ITRs Only a few days before WCIT-12, ITU member states are divided into those wanting only minimal changes and countries wanting the ITRs to introduce detailed regulation: Minimal changes: ITRs should remain high-level principles which do not change the way the internet and traffic flows work today. Detailed regulation: ITRs should potentially modify relationships in the internet value chain and grant greater control over traffic flows. These differing approaches are reflected in the 19 proposals which ITU member states have so far presented to the December 2012 World Conference on International Telecommunications 2012 (WCIT-12). The proposals relate to a wide range of issues, developed from the points raised during the preparatory phase, when ITU member states and industry (sector members) discussed and presented some 124 submissions to the working group entrusted with preparing WCIT-12. The issues include: the commercial model for the internet; differentiation of traffic management; the setting and transparency of mobile roaming charges; prevention of misuse of numbering resources; prevention of international double taxation; cooperation on cyber security; the fight against spam; and promoting energy efficiency and reducing e-waste. There has been much discussion leading up to WCIT-12, notably on the issue of internet governance and IP interconnection, which remain some of the most contentious and high profile points. BEREC was critical of proposals (such as that from ETNO) which aim to introduce new charging mechanisms and quality of service (QoS) requirements, stating, “the internet has developed well without regulatory intervention (...).the nature of services to be delivered across the network, and the charging mechanisms applied to them, should continue to be left to commercial negotiations among stakeholders.” Similarly, the European Parliament adopted a resolution urging EU member states to reject changes to the ITRs which would "negatively impact the internet, its architecture, operations, content and security, business relations, internet governance and the free flow of information online". © Cullen International November 2012 1 The ITU has tried to tackle criticism around the WCIT-12 process (namely the alleged lack of transparency) by engaging civil society in briefing sessions, carrying out an open consultation and making the results of the preparatory phase publicly available (draft of the future ITRs). The ITU has also tried to demystify “myths or misinformation” about the effect of what is being proposed (see the ITU myth busting slide deck). NB. Although the WCIT-12 proposals are only formally available to ITU members, some proposals may be found on the internet, for example, on wcitleaks. Background and next steps WCIT-12 is an ITU-led forum which will consider the review of the International Telecommunications Regulations (ITRs), a treaty signed by 178 states which provides the general framework for the provision and operation of international telecommunications. WCIT-12 will take place in Dubai, United Arab Emirates, between 3 and 14 December, 2012. Only ITU member states are full participants with the right to vote. Other ITU members, including telecoms operators, and regional organisations and agencies, have observer status. ITU member states were advised to submit their proposals by November 3, 2012 (one month before WCIT-12 takes place). But new contributions and/or modifications to existing proposals can still be made during the forum. All EU member states are also full ITU members. The European Union is an ITU sector member, with no voting rights. The EU is preparing a common position, with the Commission having made a proposal for Council’s consideration. What will be crucial for the EU, in the Commission’s view, is to ensure that the ITRs are not extended in scope and that what is agreed at WCIT-12 does not conflict with the EU acquis. If there is an agreed common position, EU member states will coordinate their actions at WCIT-12. NB. EU member states were also involved in the discussions which preceded the adoption of a European regional position for WCIT-12 with other European countries in the European Conference of Postal and Telecommunications Administrations (CEPT). While the outcome of the conference is uncertain, the nature of such international discussions tends to lead to political compromise on a final text that all parties can agree on. A. Proposals to WCIT-12 – divided views The following member states have submitted proposals to WCIT-12: Table 1 – Member states submitting proposals to WCIT-12 Member states African States Arab States Asia-Pacific Telecommunity Australia Brazil Cameroon CEPT Inter-American Communications Commission (CITEL) Cuba Hungary India Indonesia Israel Mexico Paraguay Regional Commonwealth in the field of communications (RCC) Russian Federation Tunisia USA The topics covered by the member states’ proposals span a wide range of issues and, while consensus seems achievable for some proposals, member states are divided on a crucial point of principle. Countries such as the African States, the Arab States, Cameroon and Cuba are among those which defend more thorough regulation and the rebalancing of interests in the internet and network ecosystem. The CEPT, USA, Australia and Israel have an opposite view, wanting to see minimal changes to the ITRs and to the internet value-chain, with the review focusing on promoting competition and liberalisation – the trigger for innovation and private sector investment in telecommunications infrastructure. © Cullen International November 2012 2 The table below summarises the main issues addressed in the member states’ proposals. Table 2 – Proposals to WCIT-12 – main issues Proposal on Issues covered Mobile roaming Price levels Transparency of prices Cooperation in bordering zones to avoid inadvertent roaming charges Misuse and fraud Prevent the misuse/hijacking of numbering resources Combat fraud Transmission of calling party identification and origin identification Taxation Prevent international double taxation Routing Transparency with regard to the routes used for managing international traffic Determination of which routes to be used Quality of service Transparency Minimum quality of service ensured Allowing differentiated traffic management Development of IP interconnection, providing both “best effort delivery” and “end to end” quality of service delivery New principles on economic issues Transparency of prices Cost orientation Foster investment in high-bandwidth infrastructure and ensure adequate return on investment Allow for compensation for traffic carried/terminated Cooperation on cyber security/ other security issues Cooperation to combat spam Enactment of appropriate legislation, ensuring law-enforcement, development of technical and regulatory best practices Internet governance Member states have equal rights to manage the internet, implement internet governance policies and regulate operators providing internet access or carrying internet traffic Other Scope of the review Make ITU Recommendations mandatory Access to alternative dispute resolution mechanisms on international connectivity matters Significant market power and abuse Special measures for landlocked developing countries Accessibility for persons with disabilities Emergency services Energy efficiency Freedom of expression Global telecommunications services/numbering resources Development of technical standards and legal norms, harmonisation of national legislation, jurisdictions and practices related to the investigation and prosecution of cybercrime Protection of data and privacy Annex 1 of this report provides an overview of the key proposals with an indication of the positions taken by different ITU member states. B. Internet governance and IP interconnection Prior to WCIT-12, many stakeholders have voiced their opinions on: the threat of reversal of the current multi-stakeholder internet governance model; proposals which aim to introduce compensation mechanisms for traffic carried and terminated (said to be justified in order to foster investment in high-bandwidth infrastructure and ensure adequate return on investment); and © Cullen International November 2012 3 allowing for differentiated traffic management (development of international IP interconnection providing both best-effort and end-to-end quality of service delivery). NB. See for example ISOC’s paper and letter to ETNO, Google’s petition, BEREC’s statement and the European Parliament’s resolution. 1. The multi-stakeholder internet governance model During the preparatory phase the Russian Federation suggested that at least some IP addresses could be attributed by the ITU (contribution 40) – a proposal which fuelled fears that the ITU “would take over the internet”. This proposal was not followed up either by the Russian Federation or by any other member state, although Russia’s final proposal defends that member states shall have: equal rights to manage the internet “including in regard to the allotment, assignment, and reclamation of Internet numbering, naming, addressing and identification resources and to support for the operation and development of basic Internet infrastructure”; the right to implement internet governance policies (including international policies); and the right to regulate the “national internet segment” and operators providing internet access or carrying internet traffic. However, several member states have overtly rejected any modification to the “architecture” of the Internet (e.g. USA, CEPT, Israel). 2. Interconnection of networks The internet ecosystem could be affected by proposals (supported, for example, by the African States, the Arab States, Cameroon, and Cuba) which aim at: broadening and clarifying the scope of the ITRs (to clearly include data networks and internet); introducing compensation mechanisms for traffic carried and terminated; and developing international IP interconnection, providing both best-effort and end-to-end quality of service delivery (a proposal introduced during the preparatory stage by ETNO and picked up by Cameroon). Despite not advocating the application of the “sending party network pays” principle (also introduced by ETNO during the preparatory phase), such proposals could lead to a modification of the standard IP interconnection model, particularly the way that costs are shared, thus affecting relations between network operators and content providers (such as Google). This could ultimately affect the internet value-chain and impact on the way content is made available. This remains one of the most controversial topics, with several member states having indicated that they wish no interference or regulation on IP interconnection issues (e.g. USA, CEPT, Israel, Australia). NB. The proposals on “fair compensation” essentially repeat the principles established in Recommendation ITU-T D.50 that commercial agreements on international internet interconnection take into account the possible need for compensation on the basis of traffic flow, number of routes, geographic coverage and the cost of international transmission. C. Participation in WCIT-12 Only ITU member states are full participants with the right to vote. Other ITU members, including telecoms operators and regional organisations, have observer status. Member States are free to select their own delegations and were encouraged to engage with a broad range of stakeholders from across industry and civil society to ensure that “all voices are heard”. © Cullen International November 2012 4 Companies such as Google, Verizon, Cisco, AT&T and Deutsche Telecom and organizations such as ETNO, GSMA, ICANN and ISOC will also be present, with a total of 1,691 delegates expected in Dubai. Contact the author: Inês Nolasco [email protected] +32 81 25 75 75 © Cullen International November 2012 5 Annex 1 – Key proposals submitted to WCIT-12 Issue ITRs - scope of the review ITU Recommendations/ Standards Proposal Backed by Keep as high-level principles Minimal changes required Australia CEPT CITEL Israel USA Keep technology neutral Australia (technical issues to be addressed by Resolutions and ITU-T Recommendations) CEPT Israel USA Exclude proposals on national/regional services/transport CEPT Ensure compatibility/consistency with the ITU Constitution and Convention Asia-Pacific Telecommunity Australia CEPT CITEL (avoid overlap with Radio Regulations) Mexico USA (avoid overlap with Radio Regulations) Ensure compatibility with the EU acquis CEPT Not to override/consistent with commitments made in the WTO, GATS, (trade agreements) Australia CEPT Israel Internet/ICT to be left out of the ITRs CEPT Israel USA ICT included in the definition of telecommunications African States Member states to ensure application of ITRs/ITU Recommendations by administrations/operators African States Cameroon Regional Commonwealth in the field of communications (RCC) ITRs not to direct actions of private parties or influence national regulatory measures Safeguard commercial, operational and technology freedom Australia CEPT Review to focus on promoting competition and liberalisation CEPT Israel (privatisation and predictable local regulation) Voluntary Asia-Pacific Telecommunity Australia Brazil CEPT CITEL Israel Mexico USA Voluntary (unless otherwise indicated in the ITRs) African States Arab States (necessary compliance with ITU Recommendations which have policy/regulatory implications) Cameroon RCC © Cullen International November 2012 6 Issue Network security issues Combating spam (e.g. cyber security, spam, misuse of numbering, naming, addressing, fraud) Naming, numbering and identifications resources Routing Quality of service (QoS) Proposal Backed by Member states to ensure compliance with the ITRs by operators Arab States Recognise standards adopted through other multi stakeholder organizations Israel Cooperation between member states Addressed in the ITRs African States Asia-Pacific Telecommunity Arab States Brazil Cameroon India Indonesia (but minimal changes to the ITRs) Cameroon African States Paraguay RCC Left out of the ITRs CEPT CITEL Israel (cyber security) USA Cooperation on data protection/ privacy related issues African States Cameroon Controlled by Member states Arab States (the resources used within their territories for international telecommunications) Member states to ensure correct transmission of call origination ID/calling line identification Arab States (implement features) Asia-Pacific Telecommunity Cameroon India Mexico RCC Member states to ensure related ITU Recommendations are complied with African States India Member states to ensure appropriate use of numbering resources which are under the responsibility/ remit of the ITU CEPT Member states to know how traffic is routed African States Arab States Cameroon Mexico (in accordance with national law) RCC Member states can regulate international traffic termination conditions at national level (to ensure security and counter fraud) Cameroon Operators to agree freely on the international routes to be used Australia CEPT (regulation is obsolete) African States Mexico USA Issues related to peering, routing or transit are to be solved by market mechanisms/ multi stakeholder approach Israel Transparency on QoS African States Mexico © Cullen International November 2012 7 Issue Availability of sufficient telecommunications facilities Allowing differentiated traffic management Internet governance Proposal Backed by Ensure minimum QoS Arab States Australia Brazil Mexico India (in line with ITU Recommendations) RCC (agreed QoS) Ensure a satisfactory QoS (in line with ITU Recommendations) Arab States Asia-Pacific Telecommunity Australia African States Cameroon CEPT (competition is the best way to ensure this) India Mexico USA Ensure QoS above a minimum level African States Arab States Cameroon To be promoted/encouraged by member states African States Arab States Australia Asia-Pacific Telecommunity Brazil (in order to support public education, health, financial inclusion) CEPT/Israel (by fostering liberalised/competitive services) Mexico USA Which is a result of implementing regulatory regimes which lead to liberalisation, promote competition and stimulate private sector investment USA Member states to facilitate the development of international IP interconnection providing both best-effort and end-to-end quality of service delivery Cameroon (but best-effort to continue forming the basis of international IP traffic exchange) Current QoS practices not to be changed CEPT Israel USA Member states have equal rights to manage the internet (including the assignment of internet numbering, naming, addressing and identification resources ), implement internet governance policies and regulate operators providing internet access or carrying internet traffic Russian Federation Member states to ensure cooperation at national level on reliability and security of the internet/infrastructure Russian Federation Internet governance to be left out of the ITRs Maintain status quo, reject proposals which aim at modifying the architecture of the internet (e.g. routing, quality of service, numbering, naming, addressing) CEPT Israel USA © Cullen International November 2012 8 Issue Mobile roaming New principles on economic issues Proposal Backed by Member states to refrain from taking unilateral and/or discriminatory actions that could impede member states access to the internet/internet websites Asia-Pacific Telecommunity Cuba Ensure transparency of retail charges (and conditions) (several member states advocate for information to be provided free of charge) African States Arab States Asia-Pacific Telecommunity CEPT CITEL Cameroon India RCC USA Ensure transparency on cost of additional paid services/ option to decline those services RCC Reasonable, competitive, non-discriminatory retail charges CITEL (regulation on charges to be tackled at national level) Cameroon India Encourage/ensure competition in the provision of roaming services Cooperation to reduce roaming charges Cameroon CEPT India Cost-oriented charges African States Ensure quality of service CITEL Cameroon Cooperation in bordering zones to avoid inadvertent roaming charges Cameroon CITEL India Ensure transparency of retail tariffs African States Arab States (info provided free of charge) Cameroon CEPT (info provided free of charge) India Same retail tariff in a given communication, independently of the routes used African States Asia-Pacific Telecommunity Brazil Cameroon Mexico RCC Avoid too great asymmetry between charges in each direction of the same communications Asia-Pacific Telecommunity Brazil RCC Cost oriented wholesale charges African States Cameroon India (regulation imposed if necessary but without hindering competition ) Wholesale charges agreed commercially Australia Brazil (on the basis of cost-orientation) Israel Mexico (member states to regulate accordingly terms and conditions of provision within their territories) RCC (subject to national law) USA © Cullen International November 2012 9 Issue Proposal Backed by Member states to foster investment in (high-bandwidth) infrastructures African States India USA (by fostering competitive and liberalised markets) Member states to ensure an adequate return on investment in network infrastructures (through market mechanisms or other, if necessary) India Member states to encourage/ ensure that operators negotiate agreements foreseeing fair compensation for traffic carried African States Arab States (reference to ITU-T D.50) Cameroon (reference to ITU-T D.50) Cuba Member states to ensure that agreements between network operators and providers of applications and services abide by the principles of fair competition, innovation, adequate QoS, security African States Member states to ensure that operators have the right to charge providers of applications and services access charges based on the agreed QoS (to balance revenues in the ecosystem and ensure investment in high bandwidth infrastructure) African States Addressed in the ITRs African States RCC Left to commercial negotiations Regulation in ITRs is obsolete Brazil Cameroon CEPT (ITU-T Recommendations to deal with particular arrangements) Israel Mexico USA Prevent international double taxation Australia Asia-Pacific Telecommunity Cameroon India Mexico RCC USA Fiscal issues not within the scope of the ITRs CEPT Significant market power/ abuse Evaluation of significant market power/abuse to take into account international market shares/ international market Cameroon Alternative Dispute Resolution (ADR) Access to ADR and to the national regulatory and competition authorities of the other party’s state African States Persons with disabilities Encourage the provision of services/set international standards that ensure accessibility to persons with disabilities CITEL Hungary India Landlocked developing countries Adopt special measures to ensure access to international fibre networks Cameroon (e.g. special rates) CITEL India (special interconnection rates) Emergency services Inform users of the emergency number (e.g. when roaming) African States Cameroon India RCC Fair compensation for traffic carried (e.g. on the basis of traffic flows, number of routes, cost of international transmission, geographic coverage, network externalities) Accounting Taxation © Cullen International November 2012 10 Issue Proposal Backed by Cooperation to introduce a single number for calls to emergency services globally Cameroon India Cooperation to encourage international energy efficiency standards and best practices to reduce energy consumption/e-waste African States Cameroon Cooperation to avoid harm due to disposal of e-waste African States Freedom of expression Privacy Ensure protection Tunisia Global telecommunications services (GTS) Global numbering resources Member states may implement GTS in their national laws Brazil Cameroon India Energy efficiency E-waste NB. The list of proposals covers the main submissions and points raised but is not exhaustive. © Cullen International November 2012 11
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