The concept of a "licence"

Listening to David's podcast on the concept of a licence, described, with reference to the OED, as a government-granted permission to do something which would otherwise be illegal, and the particular emphasis on the government-centric nature of licence, made me think.

What struck me is that, under English law at least, a licence is a very simple notion, far simpler than the definition proposed here — a licence is simply a permission granted by someone who has a power to restrict others from performing the act in question. When I permit someone to perform an act restricted by copyright in respect of a copyright work of which I am the owner, I am granting a licence; likewise, when I permit someone to walk over my land, I grant them a licence. In each case, I have the right to exclude — central to the notion of ownership of property — but I choose to permit.

Although a subject of some considerable debate, a licence, to my mind, is fundamentally different from a contract, since it requires no meeting of the minds — it is devoid of any of the formality required for a contract, such as offer, acceptance, consideration, or an intent to create legal relations. Instead, as a bare permission, I am entitled to do something which I would otherwise not be entitled to do — this need not be something which would otherwise be illegal, though, but merely something which would trigger some form of liability; indeed, to my mind, a licence is generally granted to permit something which would otherwise be a tort (such as trespass, or copyright infringement) rather than a crime.

When we consider licensing in the telecoms context, as opposed to either a statutory or state monopoly, or an authorisation, I would see a licence as being closer to a negotiated agreement than a bare licence in that, in return for a payment (consideration) and the agreement to abide by certain terms, one party secures the right from another to provide a telecommunications service — the fundamental parts of a contract would seem to be made out. Indeed, since a licence is generally revokable at will, absent the equitable protection of estoppel, I would perhaps ask if it is not the contractual nature of what is termed a licence in this context which gives rise to the certainty, which is the stimulus for the investment. Conversely, an authorisation is closer to a bare licence, to my mind, whereby someone who satisfies certain requirements is permitted to do something which would otherwise be restricted (such as providing a communications service). One of the main benefits of an authorisation-based scheme is that there is no need to enter into negotiations for a "licence" — as long as one complies with the then-current requirements, one is permitted to operate.

What are your views on this? Do the terms really seem to be the wrong way round, or am I missing something more fundamental?

Weekend review

I would be interested to know how you are getting on with the issue of Regulators and Commissioners and which you find most appropriate in your jurisdiction. Any questions please don't hesitate to contact me at d.mellor@soton.ac.uk Have a good weekend and look forward to receiving your theme reports on Monday week.

Telecom Regulations in a turbulent time: the situation in Egypt

This post is based on an email discussion I had with Prof David Mellor, as the discussion seemed to be productive, Dr Mellor suggested that we share it on the blog and open the discussion with more participants.

As an introduction, for those unfamiliar with the current political conditions in Egypt, the country has been facing major transformations since the Arab spring and the overthrow of the ruling regime in January / February 2011.
During those 12 months, Egypt had 3 different Prime Ministers and 3 different ICT ministers; which certainly had an unlikely impact on the telecom regulations.

It also deems necessary to share some information about the telecommunications environment and market, please refer to the footnote* for a brief introduction.

Due to the political instabilities, Foreign Direct Investment (FDI) and tourism revenues are declining, creating economic pressures, resulting in a growing trend in protecting the existing government sources of income, including Telecom Egypt dividends (approx. Net Profit of GBP 300 in 2011).

There is also an on-going general mood of favouring public over private investments, and perceiving privatisation as driven by corruption.

All those factors are resulting in the following symptoms:

1) Difficulty in balancing between long- and short-term objectives
Although this is one of the major challenges facing most regulators, during turbulent times, the magnitude of the challenge is multiplied.
As an example, market reforms through additional liberalisation, as a long-term objective has a negative effect on the incumbent’s short-term financial results.

2) Delay in licensing new services / promoting existing services
Licensing new services specially requiring large investments cannot be offered during uncertainties. As a result, LTE plans will not be realized in the near future, same applies to an ambitious broadband initiative, aiming at tripling the fixed broadband penetration in 3 years.

3) Slow decision-making
Fearing allegation of corruption, decision-making process in the government is escalated to higher than usual levels. Operational decisions are often escalated to board of directors, and in some cases to the general assembly.

As a remedy for this situation, there are certain steps that have to be taken. Some of the possible solutions may be:

1. Detach the NTRA from the ICT ministry
   
2. Issue MVNO licenses, and allow the incumbent an MVNO license opportunity
   
3. In return, introduce competition in the services where Telecom Egypt enjoys a monopoly (or duopoly) status, for example Infrastructure and International voice gateways.

I hope you find this post useful, your comments are highly appreciated

*Footnote
The regulatory body is the National Telecommunications Regulatory Authority (NTRA), which reports to the ICT ministry, and the minister himself is the NTRA (honorary) chairman.

The incumbent (Telecom Egypt) is primarily government owned (80% of the shares) and it enjoys monopoly position in:
• Plain Old Telephone Services (POTS)
• Transmission Network Infrastructure
And a semi-monopoly in the International voice gateway (Etisalat Misr, the 3rd mobile operator is licensed to operate an international voice gateway, limited to its own traffic)
It also fully owns the market leader Internet Services Provider (approx. 60% market share)

Telecom Egypt does not own a mobile license (MVNO is not yet introduced in the market); it owns however a stake of 45% in Vodafone Egypt

The mobile market is highly competitive, 3 MNO licenses were issued

As for the data market, there is a high number of ISP’s which are continuously being consolidated, mainly under mobile operators.

The NTRA recently issued 2 infrastructure licenses, with the scope limited to the residential closed compounds.

For a complete list of the licensed telecom services, you may refer to:
http://www.ntra.gov.eg/presentations/LicensedTelecomTree16012012_En.pdf

US regulator blocks rollout of LightSquared Network

After a lot of to-ing and fro-ing and shilly-shallying the US national comms regulator, the Federal Communications Commission (FCC), has ruled that the ambitious nationwide LTE/satellite network planned by LightSquared will not be allowed because it would cause "serious interference" with GPS signals, services and devices.
What makes the decision all the more galling for LightSquared is the fact that the FCC had earlier given conditional approval for network deployment and the company was working, and spending money, to do just that... ful text.

Weekend Review

Neil,Shahir Sitiveni and Chantel are currently following this blog to my knowledge and Ian tells me that six others have expressed an interest si I hope you all join and allow me to share over forty years of experience gained working in the Telecomms Industry. Since I have visited over 120 Countries I no doubt have been active in the Region where you reside and have probably had the experience to meet your colleagues. I look forward to receiving more emails as you reflect over the weekend which modules you are going to follow. In the meantime ask yourselves does the Regulator/Commission improve ICT Provision in your Country? Share with others your experiences.have a good weekend. David

Success

Dear Students If you can read this it is my first blog and merely a test. Please send me an email to d.mellor@soton.ac.uk if you manage to read the text. Best regards David Mellor

"Cisco to challenge Microsoft Skype deal at EU court"

The BBC, and a number of other sources, is reporting that Cisco is to challenge Microsoft's takeover over Skype. (Story here.)

Cisco has written that its appeal:

is about one thing only: securing standards-based interoperability in the video calling space. Our goal is to make video calling as easy and seamless as email is today. Making a video-to-video call should be as easy as dialing a phone number. Today, however, you can’t make seamless video calls from one platform to another, much to the frustration of consumers and business users alike.

Cisco believes that the right approach for the industry is to rally around open standards. We believe standards-based interoperability will accelerate innovation, create economic value, and increase choice for users of video communications, entertainment, and services.

This is of particular interest to me, as, currently, it does not seem clear that telecoms regulation in the EU relates to over the top services.

The definition of "electronic communications services" in directive 2002/21/EC is a service "which consists wholly or mainly in the conveyance of signals on electronic communications networks," and "electronic communications networks" is defined as "transmission systems and, where applicable, switching or routing
equipment and other resources which permit the conveyance of signals." Whilst the definition goes on to talk about circuit- and packet-switched networks, it seems to be that this relates more to GPRS/UMTS than to services which are carried over the top of such networks, such as Skype traffic. (c.f. s3.19 of Ofcom's statement on the regulation of VOIP services and access to emergency services, although even this may be encompassing more than the wording of the directive permits, in my opinion.)

It is likely that my first theme report is going to focus on the extent to which regulatory principles should apply to over the top services, but, irrespective of telecommunications law, it seems that Cisco has a reasonable complaint here, based on competition law. However, it would be highly desirable for interconnection obligations and the like to apply to over the top services, irrespective of PSTN breakout, from a consumer point of view. It is likely, however, to be far less attractive to providers of such services, where access to the service is a "stickiness" factor for the product — the ability to use FaceTime, for example, is dependent (currently) on the purchase of Apple hardware.

What do you think? Is Cisco right to make this challenge? Should regulatory principles apply to over the top services?