CONVERGENCE: The Search for a Sarkari Approach!

Someone who has even seen (forget about reading) the Final

Draft Report of the Sub-Group on Convergence headed by Fali S Nariman, is bound

to wonder how even a highly hyped phenomenon like convergence could be made to

sound so sarkari.

But be prepared for more. Because, if the Government accepts

what the report suggests it to do (and chances are that it will), you will soon

have to go through more such sarkari stuff–bills, amendments, terms of

reference and so on.

Lest you should start worrying, there is another side to the

story. Though the structure and language of the Report might be very sarkari,

the underlying tone is surely not. Somewhere hidden within those 100-plus pages

of definitions and clarifications, histories of governmental work and

classifications, are suggestions for regulatory changes and steps that can be

called truly radical by any international standards. But more of that later.

What one fails to understand is what (and/or who) stopped the

Government from publicizing (read marketing) the report?

Shyamal Ghosh, DoT secretary, told one of the reporters of

V&D recently that all the answers to his questions were actually in the

Report, which is available on the Internet. We did manage to get the Report

after some frantic search, but from ICICI’s (not from DoT’s/MIT’s/NIC’s

or any of the other government departments concerned) web site through an

external search engine. And there was not even a link to it from the CII’S

home page. We almost began to doubt our Internet searching skills, but were

saved by most of the top executives who also asked us for the URL of the Report!

They had apparently known only about the existence of the Report but had not

seen it. Only in October did ASSOCHAM organize a discussion forum on the Report.

Government’s indifference is nothing new, but what really

made matters worse was that the mainstream media chose to ignore the report and

its content! "May be people feel there is not much in it to read, "

quipped Fali S Nariman, the main protagonist of the Report.

The remark did little to hide the Government’s failure to

publicize the Report. And this old mindset is the first block in the

implementation process. Gone are the days when government policies did not need

marketing. Today, success in policy making, like product selling, comes more

from marketing than anything else. Remember Reed Hundt, the charismatic

erstwhile FCC chairman, who marketed an idea called "spectrum

auctioning" so well that it changed the course of mobile communications

throughout the world?

The Report

The mandate before the Sub-Group was to find out ways and

means for a governmental response to the sweeping changes that were taking place

in the markets because of vanishing lines among traditionally different sectors.

And the message of the report is more than clear: Convergence

is inevitable; facilitate it; do not try to create roadblocks. Clearly, you

cannot apply different set of rules to people who compete in the same space just

because once upon a time they were different!

The report unequivocally suggests the need of integrating

telecom and broadcasting licensing and regulation under a single, independent,

and autonomous super regulator to be called Communication Commission of India.

The Need for a Re-look

Worldwide, convergence of technology has thrown up new

challenges before regulators. Traditionally, regulators have had different roles

and jurisdiction over different sectors. Some of the problems that are being

encountered because of this are:

• Confusion
  
  regarding objectives of regulation: This was on account of a conflict
  
  between social/nationalistic objectives and pure economic objective.

• Limitation of
  
  sector-specific regulation: Sector-specific regulation is becoming
  
  increasingly difficult due to possibility of cross-sector service provision
  
  because of emerging technologies.

• Limitation of
  
  geography-specific regulation: While terrestrial broadcasters are subject to
  
  strict regulation within the country, satellite channels beam without any
  
  stringent regulation.

• Present
  
  regulatory framework is unable to handle new media and services like
  
  Internet.

• Overlaps of
  
  regulatory domains of multiple regulators.

• Inequality in
  
  regulatory frameworks of different countries.

• Conflicting
  
  regulatory stances by different regulatory agencies affecting operation of
  
  companies.

• Emergence of new
  
  monopolies on account of consolidation.

The report of the Prime Minister’s Council on Trade and

Industries (Infrastructural Development), under the convenorship of Ratan Tata

had also recommended for an Integrated Communication Policy (ICP) taking into

consideration the convergence of technology, allowing all services to be carried

on a single infrastructure. It specifically decried government ban on ISPs for

carrying voice traffic on their networks. It had suggested the Government to

take the US Telecom Act of 1996 as a benchmark for formulating the new

legislation. The objectiv of the ICP as recommended was to embrace technology

convergence to spur growth in the telecom sector.

However, India’s first official statement of intent to

change itself in the wake of convergence came through NTP ’99.

"Convergence of both markets and technologies is a reality that is forcing

the alignment of industry. Convergence now allows operators to use their

facilities to deliver some services reserved for other operators, necessitating

a re-look into the existing policy framework," it noted.

In the light of the increasing convergence between telecom,

broadcast, and IT, the PM ordered the constitution of a group under finance

minister, Yashwant Sinha, to suggest steps to speedily implement the NTP ’99.

This Group on Telecom-IT Convergence constituted three Sub-Groups, of which the

Sub-Group III was on Convergence, whose report is under discussion here.

However, despite the best of intents and the reformist stance

taken by the NTP ’99, what came in the way of a smooth implementation was the

ancient (!) Indian Telegraph Act of 1885. The need was to change the law as well

as the implementers of the law. The Nariman Sub-Group Report suggests ways to do

that.

Options for Regulatory Model

The model suggested by the Report envisages a single

regulator for everything instead of the present sector-



specific regulation, where telecom and broadcast have their own regulatory
mechanisms. The Report is heavily influenced by Malaysian Communications and

Multimedia Commission Act 1998 and FCC 1996 of USA. According to Nariman,

"We have not followed any particular model, we have only been inspired by

the Malaysian and FCC model." About the uniqueness of the Report, he adds,

"This is a new thing, something which has not been done anywhere in the

world except Malaysia. Even there, there is Government control, whereas here we

want to avoid Government control. In Malaysia, the licensing is done by

Government. Here it will be by the Commission."

The Communications Commission of India

The Commission is supposed to interact with the various

sectors of the industry to help set standards and formulate regulatory norms–both

for content and carriage of information. The Commission will also manage the

contentious area of spectrum. It will have the power to advance, facilitate, and

encourage the growth of technological and social development. The Report

emphasizes the importance of self-regulation, flexibility of law with no

political interference of any sort. It has suggested the appointment of highly

qualified and independent persons of integrity as members of the Commission.

What Happens to TRAI?

After much deliberation, the Report recommends that the

present TRAI would be subsumed into the proposed Bill. The Commission to be set

up would be in addition to the functions already being exercised by the TRAI,

empowering to exercise much wider functions of regulating and licensing of

carriage and content of all transmitted information.

Conflict Between the IT Act and Ensuing Act?

The Report clearly puts aside any speculation about

integrating IT Act into the ensuing Communication Bill. It has taken note of DoT’s

note to Nariman, which mentioned "IT Bill 2000, which dealt with the

details of e-commerce activity having been already passed, need not be

incorporated in the draft." But it was felt at the same time that certain

provisions of the IT Bill relating to the inclusion of sound in the definition

of "Information" and those relating to "Interception" and

"Encryption" would have to be viewed in the context of Indian

Telegraph Act. Necessity was also felt for covering the Indian Telegraph Act,

Indian Wireless Act of 1933, and Broadcasting Bill and perhaps some of the

provisions of the IT Bill in so far as convergence was concerned.

According to Dr BM Athreya, "Every step is a forward

step. It may not take place in the most logical manner, but whatever movement is

happening let it take place. Then they can be reintegrated later." Any

overlap and conflict of interest might pose a new challenge towards the smooth

and speedy implementation of the Report.

Implementation: The Key

What is of crucial importance is the implementation of the

Report given the long and arduous process of its passage through the Parliament.

We have the precedent of IT Bill hanging for three long years before being

finally passed and implemented recently. Nariman, the chief architect of the

report, talking to V&D said, "To fix a time frame for implementation is

difficult. There has to be coordination. All ministries have to agree and it

will take a couple of months before it is introduced in the Parliament."

Ram Vilas Paswan, the minister for communications, said, "We are working on

it and will get it passed in the coming winter session of the Parliament. We are

doing everything ahead of time." Meanwhile Shyamal Ghosh, chairman, Telecom

Commission, said, "The Report will involve a lot of examination in the

sense that it is a new initiative and above all, India is the first country to

take such initiatives. FCC has done something but ours is the most comprehensive

approach. We should not be too hasty. We have to think thoroughly. A lot of

effort has gone into it but more efforts will be necessary."

Composite licensing

Licence would be provided for one or more than one category,

depending upon request. One composite licence could also be issued for all or a

combination of categories on the condition that it ensures fair access and

promotes competition. However, according to Ghosh, "Restricting it to just

one composite licence will also be restrictive in a way. Somebody may not like

to go into all the fields. So there has to be a choice with the operator. It is

this practice which has encouraged us to provide unrestricted entry of players

in all sectors except where spectrum is a constraint."

Categories of services/licensing

According to the Report, the licensing authority would be

required to grant licence to any person for establishing, maintaining,

and/operating any or all of the following services:

• Network facilities or infrastructure, including earth
  
  stations, (b) fixed links and cables; (c) public payphone facilities; (d)
  
  radio communications transmitters and links; (e) satellite hubs; (f) towers,
  
  poles, ducts and pits used in conjunction with other network facilities, and
  
  (g) such other network facilities as may be notified by Central Government
  
  from time to time.

• Network services including bandwidth services (b)
  
  Direct-to-home delivery services; (c) Local delivery services; (d) Cellular
  
  mobile services; (e) Customer access services; (f) Mobile satellite
  
  services; and (g) Such other network services as may be notified by Central
  
  Government from time to time.

• Application on any network service including PSTN
  
  telephony; (b) Public cellular telephony services; (c) IP telephony; (d)
  
  Public payphone service; (e) Public switched data service; and (f) Such
  
  other application services as may be notified by Central Government from
  
  time to time and

• Content application service including Terrestrial
  
  Broadcasting; (b) Terrestrial Television Broadcasting; (c) Satellite Radio
  
  Broadcasting; (d) Satellite Television Broadcasting (e) Such other Content
  
  Application Services as may be notified by the Central Government from time
  
  to time.

Communication in Rural Areas

The Report states that the Commission will ensure that

communication facilities are made available to all uncovered areas including the

rural, remote, hilly and tribal areas. It ensures that consumers in all regions

of the country, including low-income consumers and those in rural and insular

areas should have access to telecommunications and information services,

including interexchange services and advanced telecommunications and information

services, that are reasonably comparable to those services provided in urban

areas and that are available at rates that are reasonably comparable to rates

charged for similar services in urban areas.

Type of technology/services

It will be technology-neutral and service-sector neutral. Any

service can be provided using any technology. (One can hope Internet telephony

and Limited Mobility over basic phone finally becomes a reality.)

Implications

The question is should we get excited about it? At ground

level much needs to be done. The greatest hurdle will be the process of creation

of a unified Ministry for Convergence. Political stakes will be high and no

ministry or minister for that matter would be ready to lose its clout in the

decision making process. There would obviously be strong resistance from the

bureaucracy also. Given the current political equations, it would be very

difficult to bring diverse ministries under one roof.

Sudesh Prasad