ITU News asked Chairman and CEO, Eng. Salim Muthib Al-Ozainah, about telecoms infrastructure sharing in Kuwait.
What is the Kuwait telecoms regulatory authority’s approach to infrastructure sharing?
Eng. Salim Muthib Al-Ozainah Telecom infrastructure is a crucial part of a digital economy. A robust telecom infrastructure can no longer be restricted to voice and data communications. It has become a vital part of the service delivery chains for a growing number of industries. Over-the-top services offered over telecom infrastructure are exceeding in value and are becoming an indispensable part of the user experience.
The challenge for operators and regulators is to strike a delicate balance between promoting digital services, and ensuring that operator investments made in developing telecom infrastructure is both profitable and sustainable.
The Kuwait Communication and Information Technology Regulatory Authority (CITRA) views infrastructure as a utility, and the Internet as a platform for the growth of a digital economy. Infrastructure sharing, in CITRA’s view, is one of the cornerstones for achieving this balance, and is taking a position that supports the sharing of infrastructure, for both fixed and mobile communication networks. CITRA’s mandate by law, includes allowing access to telecommunications facilities or services of another licensed operator.
CITRA’s approach is to support infrastructure sharing by enabling conditions conducive to voluntary, market-based sharing, through the introduction of positive incentives, such as reduced license fees for mobile site licenses, and encouraging mobile infrastructure sharing by licensing companies that are specialized in mobile infrastructure sharing as a standalone business.
The sharing of mobile telecom Infrastructure is constantly evolving, motivated by financial and other incentives. With growing competitive intensity, and lower prices, mobile operators are facing margin pressure, and need to systematically improve their cost position.
Operators are adopting multiple strategies, with infrastructure sharing emerging as a mechanism to substantially and sustainably improve and reduce network costs.
On the fixed network, CITRA is addressing infrastructure sharing through interconnect regulations that prevent operators from exploiting their dominant market positions. Although mechanisms for sharing fixed network infrastructure are complex, CITRA believes that enabling market structures that allow the transparent and efficient sharing of passive network infrastructure will help build a robust and sustainable fixed network service market, where everyone will benefit.
What are some of the opportunities and challenges you see regarding infrastructure sharing?
Eng. Salim Muthib Al-Ozainah Recent industry trends show higher awareness and readiness towards network sharing, also among operators seeking cost optimization and technology refresh currently aiming at optimizing access transmission through sharing leased lines and microwave links.
Kuwait has a developed mobile services market that leads national penetration and coverage indicators. CITRA believes that there is room for improvement of services and cost reduction. For example, proactively working with operators to plan service rollout in new areas helps to ensure that the underlying infrastructure required for backhauling traffic is either available, or facilitated, through appropriate right of way and other permissions.
As any telecom regulator, CITRA’s main challenge is working with other State institutions to promote its broadband agenda. CITRA is working to develop a harmonized and holistic approach across all distinct government actors, to reflect infrastructure sharing as a component of a Kuwait’s broadband policy.
CITRA is developing policies designed to facilitate cross-sector infrastructure sharing to ensure that telecommunications operators have access to existing and planned land corridors, established for other public or private purposes, to ensure a telecommunications operator will be unhindered in its ability to build a new network, extend an existing network, or commercialize excess capacity on an existing internal utility network.
Taking a holistic approach to telecom infrastructure, will help offset development costs that are eventually passed on to end users. For example, it is much more efficient and economical to ensure that telecommunications operators have access to corridors established or planned for other purposes, such as plans for unitality connectivity, than to require them to assemble their own corridors.
In addition to the passive infrastructure owned by the Ministry of Communications (MoC), other ministries and State enterprises reportedly own facilities that have excess capacity in ducts, fiber, towers and poles, which are not currently shared with operators. CITRA is working with other government agencies to allow the operators to make use of these assets, that can bring new services to customers faster, and at lower costs and meanwhile, prevent further degradation to the environment.
Has infrastructure sharing resulted in wider coverage?
Eng. Salim Muthib Al-Ozainah Kuwait’s experience in opening up the mobile communications market is rather unique because of its flat terrain and population concentration on a relatively small area.
Infrastructure sharing has not only resulted in wider coverage, but has also allowed new market entrants to reduce the time taken for network rollout and service launch. Among the three mobile operators working in Kuwait, shared mobile site infrastructure accounts for nearly 30% of operator sites deployed. On the fixed network side, 100% of the Internet service providers use shared last mile access infrastructure to deploy Internet services.
The fixed network infrastructure is currently owned and operated by the State-owned Ministry of Communications. We are working towards horizontal unbundling of State-owned assets, with an urgent focus on the passive network to be owned and operated by an operator neutral independent entity.
Has infrastructure sharing led to lower prices?
Eng. Salim Muthib Al-Ozainah Kuwait’s telecom service prices are among the lowest in the Arab States region. We believe strongly that this is in part due to the infrastructure sharing mechanisms that are both regulated and market driven. Mobile and Internet service prices in Kuwait are also lower when compared across the region. This is due, in part to the sharing of infrastructure owned by the Ministry of Communications, which enables lower build costs for operators or telecom services.
Are there any types of infrastructure sharing that the regulator will not allow? If so, why?
Eng. Salim Muthib Al-Ozainah CITRA will always encourage infrastructure sharing agreements that benefit the end users of telecom services, either by reduction in pricing or by improvement in service quality and efficiency. CITRA will not allow any type of infrastructure sharing agreement that either directly or indirectly affects competition and access to affordable telecom services.