Telecoms and media analyst group Analysys Mason has released a report that says recent proposals to regulate the global Internet will harm growth and innovation worldwide. The report assesses the current state of the Internet in under-served and developing regions worldwide, and provides recommendations for governments on developing an Internet ecosystem that imposes minimal restrictions on users.
The report is called “Internet Global Growth: Lessons for the Future” and was written by Michael Kende, co-head of Regulation at Analysys Mason. It examines the impact of proposals that seek to apply the “antiquated settlement system for terminating international voice calls over the legacy telecommunications network to Internet traffic.”
Kende says the proposals addressed in the paper are to the International Telecommunications Regulations (ITRs), which are being readied for the World Conference on International Telecommunications (WCIT) to be held in Dubai this December by the United Nations’ International Telecommunication Union (ITU).
“The report highlights the Internet as a driver for growth and opportunity, noting its increasingly central role to consumers, businesses and governments alike,” says Kende. “The Internet has successfully evolved based on commercial considerations as opposed to regulatory dictates.
“Content has transformed from largely text-based to multimedia delivery, global demand and usage has exploded, and access has moved toward wireless over wired. Significant investments must continue to occur in response to these patterns, as current projections show that the number of Internet users worldwide will increase from 2.2 billion today to 3.5 billion in 2020”. The report confirms the continuing increase in Internet deployment using mobile broadband throughout the entire world, especially in Africa, Asia and Latin America, and that such investments are best achieved without internationally sanctioned regulatory intervention.
Multimedia content requires high bandwidth and can be expensive to deliver, but up to 98 percent of Internet traffic now consists of content that can be stored on servers, such as streaming video or web pages. These servers can be located in multiple locations around the world, and then delivered to users faster and at lower cost.
The result is a shift in usage patterns and global Internet traffic flows. For example, 70 percent of international Internet bandwidth originating in Africa went to the USA in 1999, but by 2011 this figure had dropped to less than 5 percent, as bandwidth shifted to Europe. Now, content is increasingly being stored on servers in Africa, where it can be accessed domestically or regionally.
The report offers recommendations for governments in developing countries on cultivating a robust Internet ecosystem without imposing any form of accounting rates on the Internet. Specific suggestions include removing roadblocks to investment while stimulating demand, as well as full liberalisation of the sector while removing barriers to foreign investment and ownership.