Universal Access Funds

Source: World Dialogue on Regulation
The emergence of next generation networks (NGNs) is already impacting on current market structures with the separation of infrastructure and services provisioning - an obvious example of this being internet protocol (IP) based services. Naturally this raises challenges for regulators in developed telecom markets where this transition to NGNs and take-up of their corresponding services is already taking place. Universal service issues that had been more-or-less settled for monopoly markets and then revisited in a privatised context now need to be reviewed again (including quality of service, emergency services, directory assistance, itemised billing and public pay phone provision). [see more]
The issue of funding is at the hub of the preparations for the second phase of the World Summit on the Information Society (WSIS) to take place in Tunis in November 2005. The central elements of this debate are the definition of the protagonists and the most appropriate solutions to attain the objectives proclaimed in the first phase in Geneva, in the year 2003.

In the last two decades the advent of a new vision of goods and services related to information and communication technologies reduced the State’s power as a decision maker. Over the past twenty years, the telecommunication sector has been radically taken on a commercial rationale in which numerous operators wage ferocious competition.

While limited, it would be false, however, to assert that the State no longer has any space to ensure financing for universal access. New mechanisms thus have appeared: universal service obligations included in the concessions and licenses granted to operators, taxes on asymmetric interconnections favoring rural operators and, particularly, universal access funds (UAFs). The latter appears to be one of the most promising of these mechanisms.

Born in 1994 in Latin America, universal access funds have seen a phenomenal expansion in recent years as a consequence of success. The process is simple: the State, in collaboration with local authorities, first identifies needs and divides them into small projects (for example, one tele-centre in each of the ten midsized towns of the country). It then sets them “in competition”: the company that requires least subsidies gets the license to operate.

Presently, these funds exist or are being planned in close on 60 developing countries or countries in transition. Their objective is to enable communication services in the hands of private companies to be established in rural and/or isolated regions, by granting a subvention to cover the costs and high initial investment.

Although the very recent nature of these mechanisms and the variability of the results do not enable an in depth assessment to be made, some of their aspects have proven to be very promising. Firstly, the innovative and original method of allocating subsidies through setting operators in competition, leads to considerable savings. Secondly, the broad applicability of the model, which applies to infrastructure projects as well as to the creation of contents. Finally, the definition of projects by a single entity, makes it possible to have an overall coherent vision at national level.

Based on the paper “The funding of universal access” by Joëlle Carron
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      Versión en español
Wednesday, July 12 2006
Regulatory challenges for Universal Service in Next Generation Networks
(Source: World Dialogue on Regulation)
Friday, May 19 2006
Telecom use on a shoestring
(Source: LirneAsia)
Thursday, November 03 2005
Dollar divide, digital divide: funding the ICT revolution
(Source: Panos London)
more on this issue

The State loses space

Regulatory challenges for Universal Service in Next Generation Networks (World Dialogue on Regulation)

The global information society: visions, people and power (University of Geneva)

Policy and regulatory challenges of access and affordability (Networking knowledge for Information Societies: Institutions & intervention (Delft University Press))

WTO trade agreements and ICTs (Choike)

UAFs in developing countries

Universal Access Funds (Intelecon Research)

UNECA urges Universal Telecom Fund

Universal Access Funds in Latin America and the Caribbean (ECLAC)

Peru Telecoms Investment Fund (Global Knowledge Partnership (GKP))

Negotiating the net: The Ghana case (Center for International Development and Conflict Management, University of Maryland)

Uganda: a success story? (PANOS)

Designing effective and efficient funding mechanisms for rural connectivity in Sri Lanka (Social Science Research Council (SSRC))

Closing the gap in access to rural communications: Chile 1995-2002 (World Bank)

Beyond the market zone: The funding of universal access

Telecom use on a shoestring (LirneAsia)

Dollar divide, digital divide: funding the ICT revolution (Panos London)

The funding of universal access (WSIS Papers)

A new policy framework for ICTD (APC)

Telecommunications and information services for the poor: toward a strategy for universal access (World Bank)

Rural telecommunications development in a liberalizing environment: an update on the Universal Access Fund (World Bank)

Who pays for the Information Society? Challenges and issues on financing the Information Society (Bread for All)

Task Force on Financial Mechanisms (TFFM) final report (ITU)

Universal access and service: Background information

Universal access and service (Columbia Business School)

Rural development and Universal access (International Telecommunications Union (ITU))

Universal service: International experience (Link Centre, University of the Witwatersrand)

What do we mean by "Universal access?" (Internet Society)

Universal Access Project (University of Toronto)

Access in Africa

Choike is a project of the Third World Institute
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