The role of Innovation and Convergence in Complicating ICT Regulation - Essay Example

?Introduction The regulation of ICT is a hotbed of wild debates and controversies, misconceptions and uncertainties as summarised by the recent happenings in regards to SOPA/PIPA regulation bills. Such a situation arises due to the different nature of ICT from the traditional market; conventional strategies of market regulation are inconsistent when applied to ICT. Besides, the rate of evolution and technological revolution would leave the traditional forms of regulation null and void, ineffective and bypassed at all instances. Although not a general consensus, the need to regulate ICT is not in question; rather, the approach and challenges faced are what makes the issue a burning one. This study discusses the role of innovation and convergence in complicating ICT regulation, alongside the strategies that could be successfully adopted to go about the problem. Background: Regulation and ICT According to Baldwin, Cave and Lodge (2012, p. 2-3), the concept of regulation entails a number of aspects including; a specific set of commands; a deliberate influence by the state; and socio-economic influences, all of which influence social or economic behaviour. The authors further argue that although regulation mainly elicits the perception of restricting behaviour and preventive of certain activities, it can also be viewed as facilitative/enabling. For instance, regulation permits and controls the use of airwaves, allowing for broadcasting which would otherwise be chaotic. Borras (2003, p. 142) properly captures the relationship between regulation and ICT through a discussion on standards and innovation. Standards determine the interchangeability and interconnectivity of products and thus the overall technological evolution of the industry. However, the ICT environment is heavily revolutionary in terms of technology and regulator standards find it difficult to always keep up. The regulation of ICT presents with a number of challenges arising several different perspectives and contested issues about how the regulators should go about it. Whereas issues of IPR dominate the cyberspace (Murray 2006), other areas in the ICT industry provide an opportunity to limit regulation and promote competition. For instance, elements in network industry value chains involve retailing to end-users where competition is feasible and thus limit the need for regulation. However, the limits to competition among the players in the telecommunications industry are uncertain due the impact of technology (Baldwin, Cave and Lodge 2010, p. 501). Here, innovation and convergence play an important role in complicating regulation of the ICT sector, calling for equally inventive and capable strategies to ensure proper and healthy regulation. Role of Innovation in Complicating ICT Regulation Innovation in the ICT industry occurs at a much faster pace and from many different angles than in most other sectors. As the Regulation Reform Unit (2010, p. 5-6) argues, regulatory activities and agencies have the challenge of reflecting technological changes and market developments in the ICT environment. Regulation of the ICT sector impinges on many different aspects including competition, interconnection, management of spectrum, authorisation and price controls among other aspects (ICT Regulation Toolkit 2012). Innovation impacts all of these aspects of ICT regulation in different ways but all centering on the rate at which innovation occurs. In terms of competition and price controls, the horizontal and vertical innovations witnessed everyday in the ICT sector challenge the traditional paradigm of regulation which embeds in the economic sense. Technological developments have implications on existing market structures at the overall economic level. A stable format of regulation seeking to stabilise the ICT sector would not hold in some sections as innovations render what is today valuable absolutely unimportant tomorrow. To keep up, the regulatory mechanisms have to evolve and develop new ways of regulating the newly formed ICT market structure. This may not happen at the right pace, where the regulation will have failed in its role. An example of this can be viewed in the regulation of technology in currently industrialising nations. Innovations in the ICT sector diffuse very fast to such nations from their industrialised counterparts, catching the regulatory mechanisms flat-footed. For instance, technological leap-frogging has been documented in nations such as Indonesia and Thailand (Sasmojo 2006; Sanzogni and Arthur-Gray 2008, p. 1877). Technological leap-frogging involves bypassing the stages of capacity building that took place during the development of given technologies (Steinmueller, 2001, p.2). In such cases, the regulatory mechanisms in such countries may have not developed the necessary mechanisms to regulate the changes. Innovations in the ICT sector nowadays incorporate the internet element; this brings the problems of internet governance to the rest of ICT. The internet is highly amorphous with global dimensions. Regulation of the ICT sector becomes extremely complicated once innovation incorporates the cyberspace; regulators find themselves dealing with problems and breaches in many cases not arising from within their countries or economic regions (ICT Regulation Toolkit 2012). Further, complications arise at a social level; e-security and other regulation initiatives have to balance governance and individual interests as a thin line exists between regulation and infringing on personal space or denying individuals their rights to information. The case of China exemplifies the problem; the nation has radical policies of regulating the cyberspace which have led to accusations of infringing on human rights. Hence, innovations blur the job descriptions of regulators, continuously present them with new challenges and make the sector difficult to define. Role of Convergence in Complicating ICT Regulation Convergence involves the coming together of a number of sectors in ICT; telecommunications, broadcasting and computing to develop a single digital bitstream (Gracia-Murillo and MacInnes 2002, p. 57). In essence, convergence brings together technology and services through integrating the three categories of networks, devices and applications. After several years of build up, convergence is a definite concept in the 21st century, already transforming information sharing and policy-related issues (Huseinovic, Kasumagic and Musovic 2009, p. 24). The main driving forces behind convergence include increased connectivity and more bandwidth; networks depending on advanced software and intelligence; the digitisation of various forms of communication. Importantly, digitisation has enabled owners of ICT infrastructure to provide voice, video and data broadcast over multiple networks. The figure below shows the extent to which the modern ICT sector has converged: Figure 1: Convergence in ICT (Source: Huseinovic, Kasumagic and Musovic 2009, p. 24). Convergence involves the pace and uncertainty associated with innovations in the ICT sector, and arises from the choices made by users, developers, industries and governance. Thus, future developments in convergence are difficult to predict, but the challenges brought to policy makers/regulators are clear. The main source of the complications due to convergence arises from the inherent weaknesses of the regulatory frameworks in comparison to the capacity of advancement in ICT. As Latzer (2009, p. 411) argues, the traditional regulatory mechanisms relied on technology oriented subdivisions of media and telecommunications. The traditional categorisation and separate regulatory agencies have been left stranded due to nullification of their definitions of ICT. The industry quickly proceeds into convergence while the policy-makers reluctantly shift slowly towards the contemporary disposition of ICT. Thus, convergence complicates the way regulators understand ICT and leaves their tools ineffective. Effective Regulatory Strategies to Tackle the Complications Innovations and convergence within ICT are mutual and synergistic. Hence, the suggested regulatory mechanisms are targeted for the complications of both issues. The best approach towards a solution arises from examining the roots of the problem; the failure to keep up with innovations and the blurring of traditional subdivisions for ICT regulation due to convergence. In light of this, the regulatory mechanisms have to evolve with the ICT. The mechanisms also have to adopt a visionary approach allowing for predicted and non-predicted changes in ICT which will be met by changes in the regulatory mechanisms. To respond to the problems and complications brought by the advent of ICT convergence, the best and most effective is a visionary regulatory convergence approach. The convergence aspect of the regulation entails integrated mediamatic policies and joint regulation of electronic communication systems (Latzer 2009, p. 418). More importantly, the visionary regulatory convergence would be more of an internationally uniform system to cater for the globalisation aspects of innovations and convergence. The visionary aspect would involve being at the fore-front of research efforts to establish the future directions of innovations and convergence. This would ensure that the regulatory policy has room to adopt changes that make it responsive to the changing nature of ICT. The generation of the visionary regulation convergence would be through consultative efforts by academic researchers, ICT practitioners and policy makers to ensure that the interests of all relevant parties are assured. Conclusion Regulation of the ICT sector faces complications and challenges brought about by numerous innovations and convergences. The two blur the demarcations used by traditional regulatory mechanisms and ensure that ICT develops at a quicker pace than the responses by regulation/policy makers. The solution to the proposed complications depends on studying the inherent weaknesses of existing regulatory mechanisms in dealing with convergence and innovations. A visionary regulatory convergence strategy would keep to the pace of innovations while at the same time adopting a common outlook from the different regulatory players. Hence, the proposed regulatory mechanism would have a holistic solution to the problem of convergence rather than the differentiated traditional approach. References Baldwin, R, Cage, M and Lodge, M 2012. Understanding regulation: Theory, strategy, and practice, OUP, UK. Baldwin, R, Cage, M and Lodge, M 2010, The Oxford handbook of regulation, OUP, UK. Borras, S 2003, The innovation policy of the European Union: From government to governance, Edward Elgar Publishing Limited, UK. Gracia-Murillo, M and MacInnes, I 2002, “The impact of technological convergence on the regulation of ICT industries”, The International Journal on Media Management, vol. 5, no. 1, pp. 57–67. Huseinovic, K, Kasumagic, F and Musovic, J 2009, Regulation impact on convergence of services and technologies, 17th Telecommunications Forum TELFOR 2009, pp. 34-37. ICT Regulation Toolkit 2012, 7 new technologies and their impact on regulation, International Telecommunications Union, viewed 14 Feb 2012, . Latzer, M 2009, “Convergence revisited: Toward a modified pattern of communications governance”, The International Journal of Research into New Media Convergence, vol. 15, no. 4, pp. 411-426. Murray, A 2006, The regulation of Cyberspace: Control in the online environment, London, Routledge. Regulation Reform Unit 2010, ICT regulation toolkit: Providing practical advice and concrete best practice guidelines to enable access to ICTs for all, ITU, viewed 14 Feb 2012, . 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