Competition Between National Regulatory Authorities for Operator Investment
National Regulatory Authorities are in competition with each other to attract international investment and need to take a strategic and flexible approach to regulation in an era of rapid telecommunications change.
In a landscape of finite resources and competing markets, the allocation of spectrum has become a pivotal factor in telecommunications development. Moreover, the recent discourse at a spectrum management conference highlighted the critical competition among regulators vying for telecom operators’ investments. Consequently, the primary criterion for this investment is the amalgamation of high future returns and minimal risk.
A Strategic Framework
This paper explores the complexities of the statement, offering a strategic framework for National Regulatory Authorities to attract operator investments. It discusses the trade-offs regulators and governments encounter, focusing on balancing revenue from spectrum assignments with broader societal goals, such as rural coverage extension.
One of the pivotal challenges lies in reconciling the pursuit of revenue through spectrum assignment with the imperative to ensure operators invest in expansive coverage. Overextending coverage obligations beyond commercially viable levels can reduce operator expenditure on spectrum.
Adopting a Holistic Approach
To strike this balance, regulators and governments need a holistic approach maximising long-term socio-economic benefits. This requires a regulatory setup enabling operators to exceed their Cost of Capital. In a capital-constrained world, the regulatory framework should ensure returns per dollar invested outperform those in other jurisdictions.
Our Expertise
Coleago’s deep understanding of spectrum management best practice from an operator’s perspective provides invaluable support. Having worked closely with operators for years, Coleago recently aided Tanzania’s Communications Regulatory Authority (TCRA) in formulating and executing the 700 MHz band’s spectrum assignment process. Leveraging extensive expertise in understanding the impact of licence obligations on spectrum value, this involvement enabled TCRA to craft a process and obligations that balance assignment revenues, regulatory goals, and global operator appeal. Tanzania’s approach establishes it as an attractive investment destination while ensuring a well-balanced spectrum management strategy.
Conclusion
In conclusion, amid the evolving telecom landscape, strategic spectrum deployment remains crucial for regulators and governments. Coleago’s collaboration with TCRA highlights the nuanced approach needed to foster a symbiotic relationship between regulatory revenue, policy goals, and operator investments, paving the way forward.
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