Telcos and government align for national development

SAMENA Telecom Leader’s Summit brings together telecom operators, government and industry to discuss ICT’s role in enabling national development

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Telcos and government align for national development Government and telcos need to align to ensure that ICT infrastructure is in place to enable national development plans, says Ba.
By  Mark Sutton Published  June 10, 2017

The telecoms sector holds a unique position in the digital transformation program. Telecoms infrastructure is seen as a national asset, and telecoms connectivity is increasingly expected to be as commonplace as utilities like power and water, but in most countries across the region, telecoms services are delivered by the private sector.

National plans for digital transformation are highly reliant on telecoms operators to create infrastructure and connect users. Telecoms operators, however, have to balance the demands of national development with their own commercial aims and the need to generate profits to invest in future technology.

Addressing these issues was top of the agenda at the recent SAMENA Telecom Leader’s Summit, which was held in Dubai. The annual event, hosted by the SAMENA Telecommunications Council, brought together operators, government leaders, and influencers in the telecoms sector, to discuss the challenges facing the sector.

Speaking to .GOV, Boca Ba, CEO of SAMENA Telecommunications Council, said that the event had been a great success in creating a consensus on how the parties can work together to ensure the success of initiatives such as Saudi Arabia’s Vision 2030 and other GCC national programs that make digital transformation a central part of their development plans.

“It is important to have alignment, because if we want to work towards the same direction, we have to ensure that the agenda of each party is completely aligned,” he said. “That is the objective — to reach the digital agenda, we have to make sure that everyone is heading in the same direction.”

Since its formation in 2006, SAMENA has been helping to drive conversations on development with regulators and government partners for the SAMENA membership of operators, telecom vendors, service providers and related organisations, from across South Asia, Middle East and North Africa. This year’s Summit included top-level meetings between government leaders, regulators and operator CEOs, Ba explained, to discuss collaboration and aligning efforts for the benefits of citizens and society.

With the increasing importance of ICT, it is now a lot easier to get government and operators to engage in these discussions, he added, and the SAMENA meetings saw general agreement on agenda and timelines for progress.

There are still areas for discussion where operators believe that more support from government would help to secure the digital transformation agenda, namely digital services, data, spectrum and taxation.

“These are the four main themes around which we believe we have a lot of work and collaboration required between private sector and government,” Ba said. “This discussion will be evolving over time, and the idea is to see how the government can be more flexible in terms of regulation with regards to those four pillars, and how on the other side, operators can help government, and be perceived as a development partner.”

In digital services, there is still debate in the role of ‘Over The Top’ (OTT) service providers, companies such as Facebook and Google that run their businesses on top of telecom services, without contributing to the telecom providers. The operators and OTT players have a greater willingness to work together than in the past, Ba noted, with Facebook and Google participating in the SAMENA event. Both parties are keen to partner to create value, and create value propositions for the government, he said.

Net neutrality has become a topic for discussion once again, owing to the change in leadership at the US FCC, which is pushing to overcome net neutrality. While this potentially would be good for telecom operators, Ba said, SAMENA partners are  mainly in ‘wait and see’ mode, until the situation becomes clearer.

Government allocation of radio spectrum for use by telecoms operators is a well-established area of discussion, and Ba said that he believes there shouldn’t be any issues with operators having enough spectrum to enable upcoming protocols such as 5G. Spectrum allocation to ensure widespread availability and resilience of the network may require uniform planning on behalf of operators, but spectrum should not be a barrier to progress or the roll out of new networks.

With data accounting for an increasingly large percentage of telecoms traffic, and with many operators transforming their business around data in areas such as IoT, regulation in this sector has become extremely important, Ba said, although the discussion is not as developed as the spectrum debate. Operators are faced with many variables and questions about what they can do with data services, what they can offer, and how they can align their business with these opportunities, but regulators are equally concerned about the impact of data, and have to account for issues such as data privacy, cross-border data traffic and national security.

Areas such as monetisation of data, with operators using customer data to create new lines of business, is another area that requires discussion with regulatory authorities.

“With 5G, IoT, almost 70% of total traffic will be data, so data regulation is extremely important. We are going through capacity building between government and private sector, to understand from the government perspective, how they can support the demand from the operators. We are going through this process, to understand what the data market will be tomorrow and to request what we need from government,” Ba said.

Tax regimes are a definitely a high priority area of discussion for SAMENA members, Ba noted, particularly issues such as high levels of taxation, variations in tax across different countries, levies charged on top of tax, and also the efficient use of telecom-specific taxes like the Universal Service Fund, which is raised for infrastructure development.

The main concern is the burden of excessive taxation, and how this impacts the operator’s ability to invest in future network and technology upgrades.

“The challenge is, if a telecom, operator is heavily taxed, and at the same time needs to generate substantial profit to be able to invest in the next generation of broadband network, he is feeling the heat,” Ba explained. “If the broadband infrastructure has to be improved, or has to be [expanded] across the whole country, we must have strong operators making profit, to be able to invest in the next generation of the network.”

The discussion with government on taxation has progressed, Ba said, with support from IT and telecoms ministries, and organisations such as the International Telecommunication Union (ITU), to involve finance ministries in the discussion and to help government finance decision makers to understand the importance of the telecoms sector. At various global meetings, the conversation has shifted to realising the critical nature of ICT policies and the impact of taxation and tax policy on development, and the conversation is now expanding to include other areas of government such as education and healthcare, and how digital inclusion can impact GDP as a whole.

Overall, Ba said that the conversation between telecom operators and government is moving in the right direction, as both parties realise the importance of ICT to national development: “Today we are in an era of positive collaboration with the government. At SAMENA, we are collaborating with each government in the region, to see how we can reach our objectives. The important point from a government perspective, the SAMENA members believe, is that the ICT sector has to be elevated to the national agenda. It is an industry which will help to support all the other industries, so it has to be perceived as an infrastructure to support development. It must become a national priority.”

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