NGNs will transform telecoms sector – ComReg

9 Mar 2007

The deployment of next-generation networks (NGNs) – putting fibre at the core of traditional telephony – will transform the economics of the telecoms industry forever, the chairman of the Commission for Communications Regulation (ComReg) Mike Byrne (pictured) said yesterday.

Byrne was speaking at a ComReg-organised forum on NGNs in Dublin yesterday that covered their impact on the industry in Ireland and at large throughout the world.

“Unlike legacy networks, with their dedicated and vertically integrated platforms for each individual service, the layered architecture of NGNs facilitates the delivery of multiple services over a single infrastructure,” Byrne explained.

“With fewer network elements, simpler device management and reduced power costs, NGNs offer significant potential for increased operational savings.”

On the flip side, however, in order to benefit from these potential efficiencies, network operators need to now start making the additional investment in the hardware, software and support systems, Byrne warned.

“If Ireland is to keep pace with other leading countries, and Irish end-users are to benefit from the kinds of speeds that are now emerging across Europe and elsewhere, then investment in such efficient and performance-enhancing technologies is now required.”

The regulator’s role in a market with NGNs came under the spotlight. “Just because new investment is required, this doesn’t mean that this investment should come at the expense of competition or consumer’s interests.

“I would like to stress that as the regulator ComReg is wary of suggestions that investment in NGNs needs to be in some way safeguarded or afforded special incentives through regulatory holidays,” Byrne said. He was referring to the court case being taken by the EU against Germany over a regulatory holiday granted to Deutsche Telekom that prevents other operators using its NGN for the next three years.

“Whether it is in terms of technical delivery, service development, cost drivers or business models, NGN deployment will bring change and that change will be disruptive,” Byrne warned.

“It will challenge previous assumptions, affect competitive dynamics and force all players in the industry to grapple with many issues that will no doubt be very challenging.”

He said the deployment of NGNs will result in players from different markets that were previously viewed as distinct and separate actually compete against each other.

“This will increase competition for end-users as operators will view with each other to offer the best deal in terms of choice, value and quality.

“As a regulator ComReg would encourage such moves and we are committed to removing barriers to innovation, while at the same time upholding our duties to safeguard competition and ensure that consumers enjoy appropriate protection.

“Overall we see convergence as a good thing and one which NGNs will no doubt play a key role,” Byrne said.

By John Kennedy