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Economic Policies and Methods of Determining the Costs of Services Related to National Telecommunication/ICT Networks Including Next-Generation Networks

Final Report [Question 4/1]

image of Economic Policies and Methods of Determining the Costs of Services Related to National Telecommunication/ICT Networks Including Next-Generation Networks

The report takes stock of different cost models and considers new methods of charging telecommunication/ICT services in a Next Generation Network (NGN) environment. It explains the challenges that new charging methods entail for both regulators and consumers. It questions whether, for example, those methods in particular open bundled offers and flat rates, respect the principles of correctness and fairness, inasmuch as not all tariff arrangements are based on smart online charging systems which take into account the specific needs of consumers. Charging on the basis of bundled offers and flat rates appears to be widespread, but do the consumer really need all the services contained in the bundled offer for which he/she is paying a flat rate for, and is he/she in fact able to consume all those services? The report recognizes that telecommunication/ICT services have become more affordable, however, prices could come down further given the cost reductions associated with provision of these services in an NGN environment. Based on an analysis of findings gathered through surveys and detailed case studies, the report shares some guidelines on how to promote infrastructure sharing, how to encourage price/tariff reduction to consumers through competition and how access to and use of telecommunication/ICT services can be further stimulated.

English

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Methods of determining licence fees

Licence charges, costs or fees, depending on the term used in various national regulations, are applied in different ways, both in respect of the methods used to determine them and the object to which they are applied. In some countries licences are granted for the purpose of exploiting radio frequencies, as is the case with a number of countries in Europe, while in other countries, especially in Africa, they are granted for the purpose of establishing and operating networks, irrespective of the frequencies used. The methods of determining licence charges or fees also vary from one country to another. Some administrations (NRAs or ministries), without methods of their own, apply “benchmarking” based on charges applied elsewhere.

English

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