Digital Regulation Platform
Evolving business models in the ICT sector

Evolving business models in the ICT sector

The increasing digitalization of the way we work and live also impacts the way we communicate. Instead of making traditional voice calls and sending 160 character SMS messages, people can communicate more conveniently, with full video and in groups using Internet applications. Services that were previously provided by mobile network operators (MNOs) now face competition from the public Internet. Voice calls and SMS have to compete with over-the-top (OTT) applications, such as Skype, WhatsApp, and Facebook Messenger. Cryptocurrencies based on blockchain technology may compete with mobile money. The business models of domestic connectivity providers need to adjust to these new…

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The evolving Internet value chain

The evolving Internet value chain

The Internet value chain combines various previously unrelated industries together on one platform, not just within a country but globally. To give just a few examples: Telephony started as voice calls, were enriched with texting, and now may be video calls over the public Internet. Shopping started at farm gates, moved to local markets, and now to online marketplaces. Shows and plays started on stages, moved to television and DVDs, and are now content on demand. Bookkeeping is increasingly automated via mobile apps and online services. Traditionally, TV and movie content had their own delivery channel. Today, the Internet is…

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Universal access to digital technologies and services

UA funding and financing policies: tackling accessibility challenges UA policies cover not only connectivity, but also measures to ensure affordability and inclusion. The means by which governments, the private sector, non-governmental organizations, and international bodies can effectively and collaboratively achieve these goals directly relate to variables such as population density, income, geographical features, political and economic characteristics, and available resources, among others. Depending on features such as these, countries have followed different approaches to close access gaps. Moreover, in some cases, such as Kenya, universal access is increasingly being included as a key pillar within countries’ overarching digital strategies (Republic…

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Case Study: Vanuatu’s “pay or play” scheme

The Universal Access Policy (UAP) in Vanuatu The Universal Access Policy (UAP) in Vanuatu has been designed and implemented by the national government with the aim of expanding telecommunications services to underserved and unserved areas. The UAP was approved by the Council of Ministers in November 2013 (Republic of Vanuatu 2013). The Telecommunications, Radiocommunications, and Broadcasting Regulator (TRBR) has been appointed as the implementing agency by the Vanuatu government. TRBR is responsible for the implementation of the UAP and for universal service implementation in general. It is empowered by the 2009 Telecommunications and Radiocommunications Regulation Act to enter into contracts…

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M&A activity of the main digital platform providers

M&A activity of the main digital platform providers

Introduction In recent years, the main digital platform providers have been considerably active in the field of mergers and acquisitions (M&A). Over the period 2015-2017, the leading digital platforms, Google, Apple, Facebook, Amazon, and Microsoft (GAFAM) acquired 175 companies (Gautier and Lamesch 2020). This intense M&A activity of the main digital platforms has brought to the forefront the adequacy of existing merger control tools. Can M&A regulation be tightened so as to prevent the digital platforms retaining and extending their already substantial market power? Source: Gautier and Lamesch 2020. Are regulators watching? Some of the M&A activity of GAFAM (and…

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Explanation of externalities on digital platforms

Explanation of externalities on digital platforms

Introduction One of the reasons why digital platform are special is the presence of externalities. Externalities (which are also known as network effects[1]) are an economic concept: they are a cost or benefit of an economic activity experienced by a third party which has no relation with the one causing the activity. Externalities arise from digital platforms because they act as economic agents matching two distinct groups of users, one on each side of the platform.[2] The users on one side have no direct relationship with the users on the other side of the platform, but each is affected by…

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Article: Base Erosion and Profit Shifting (BEPS)

Article: Base Erosion and Profit Shifting (BEPS)

Introduction It was Benjamin Franklin who famously opined that “nothing can be said to be certain, except death and taxes.” And, as he might have gone on to say, human beings try desperately to avoid both of these certainties. Tax avoidance (legal) and tax evasion (illegal) are as old as the concept of taxation itself. But in the digital world, especially for global digital service providers, avoiding taxes has become a lot easier. Regulators and tax authorities are now trying to catch up. Why is BEPS a problem? The Organisation for Economic Co-operation and Development (OECD) defines base erosion and…

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Amending German competition law for digital regulation

Introduction Competition law poses complex problems in its application to digital business models. Many of these digital businesses are designed to operate on two-sided or multi-sided platforms. The presence of direct and indirect network effects[1] and the improved efficiency of algorithms needed to process increased amounts of available data, have contributed to the emergence of large and powerful players. These firms also extend their portfolios by acquiring innovative services, complementary products and existing talent through intense mergers and acquisitions (M&A) activity directed, especially, at promising start-ups. There is a widespread concern that the M&A activity carried out by large players…

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Vodafone and TPG merger, Australia

Vodafone and TPG merger, Australia

Background Source: ACCC 2019: 31. TPG Telecom Limited (TPG) has operated as a retail service provider in Australia for many years, as both an infrastructure owner and operator – such as local access and submarine fibre cable networks – and as a reseller of services supported by other networks. TPG has acquired its own radiofrequency spectrum suited for the provision of mobile services. Vodafone Hutchison Australia Pty Limited (Vodafone) is a mobile network operator. It operates a third mobile network in Australia and has for several years had a market share of just under 20 per cent in the mobile…

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Access pricing for very high capacity networks in the European Union

Access pricing for very high capacity networks in the European Union

Introduction The European Commission (EC) has given a lot of attention to the matter of how access prices should be set so as to encourage investment in very high capacity networks whilst maintaining effective competition at the retail level. The guidelines developed in Europe provide a useful benchmark for regulators elsewhere, in particular for regulating the price of access to fibre of cable networks. The European Electronic Communications Code The Directive establishing the European Electronic Communications Code (EECC) was adopted by the European Parliament on December 11, 2018 (European Union 2018). The purpose of the EECC is to respond to…

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