Interconnection has, until now, provided operators with a huge source of revenue. However, with the recent directive to lower termination rates, and with many operators looking to migrate to All-IP networks, current interconnection models will need to be re-evaluated in order to comply with regulation and ensure profitable interconnection agreements for future networks.
So, what does this mean for operators? Telecoms IQ interviewed Thomas Gröb, Senior Expert for Regulatory Strategy at Deutsche Telekom, to see how European operators are meeting the recent regulatory changes.
To read the full interview, please visit the Interconnection & Termination Rates event website.
Telecoms IQ: Tell us a little about your vision for enabling QoS through IP interconnection – How can you ensure a quality enabled network?
Thomas Grob: Basically, we see two main approaches to achieve quality entirely over the internet. One is what we call, within the internet. The focus there is exactly to enable quality interconnection across networks. The focus is currently on the network interfaces. The other way is what we call without the public internet, which means kind of extranet solution that would be utilising specialised pipes. One example, in this direction is the IPX system that has been designed by the GSMA for example
Telecoms IQ: To what extent do you think that regulation can affect innovation within an operator?
Thomas Grob: The main effect that regulation can have on the innovation by operators can currently be seen in the ongoing net neutrality debate. This provides an opportunity for regulators to massively influence what is possible in the future and what is not. By this, I mean quality differentiation can be limited through regulations or ruled out entirely. We have seen permanent examples in theUS. They have put quite a restriction on the possibilities for example to monetise the of the market, or we can see an even more extreme proposal here in theNetherlands which tries to out-rule commercially oriented quality differentiation at all. It will be very interesting to see how this is going to develop in the future.
Telecoms IQ: Are there anyway operators are overcoming this?
Thomas Grob: I think the general approach chosen by network operators especially inEurope is to proactively go into the discussion. Try to explain that our plans by no means rule out innovation on the edge of the network or that we are trying to somehow leverage market power that might still exist in the excess part of the network. To really explain the economics at stake here. Saying that what network operators world wide are currently worried about is the sustainability of the so called over positioning approach. Basically, what we are trying to do is demonstrate really there is no need for further regulation and that especially the approach proposed by the European commission which focuses on promoting competition, transparency and users ability to switch their provider is fully sufficient and also give the freedom to explore new business models.
Interconnection & Termination Rates takes place in Vienna from 19th – 21st September. The conference will enable those who attend to learn how to manage the implementation of lower termination rates and how to develop effective interconnect costing models for Next Generation Networks. For more information on the conference and to read the full interview with Thomas Gröb, please visit the Interconnection & Termination Rates website.