FACILITATING CONVERGENCE : Licensing - The Malaysian ...€¦ · points Provision of a particular...
Transcript of FACILITATING CONVERGENCE : Licensing - The Malaysian ...€¦ · points Provision of a particular...
www.cmc.gov.my© Malaysian Communications and Multimedia Commission
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FACILITATING CONVERGENCE : Licensing - The Malaysian Experience
ITU Regional Regulatory Seminar Dalian, China, 5 – 8 August 2002
www.cmc.gov.my© Malaysian Communications and Multimedia Commission
EI/July 2002
AGENDA
1. New ‘convergence’ based Licensing Regime2. Implementation – Migration of Licensees 3. Licensing Environment under the Communications
and Multimedia Act 1998 (CMA 1998)A. Universal Service Provision
4. MCMC as a convergence regulatorA. Digital Signatures Act 1998B. Postal Services Act 1991
5. Conclusion
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New ‘convergence’ based Licensing Regime
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The sector used to have many different categories of licenses
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Licenses issued under the old regulatory framework were service-specific and technology-specific.
These restricted competition into narrow markets and did not allow licensees to move freely into related and adjacent activities.
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The Communications and Multimedia Act 1998 has organized
the sector under four markets
Network Facilities
Network Services
Applications Services
Content ServicesLicenses issued under the new regulatory framework are
service-neutral and technology-neutral.
Licensees compete in four economic markets, i.e. Facilities, Connectivity,
Applications, and Content Applications.
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The New Licenses allow for greater business flexibility
Range of business options
Old Verticallicense
New HorizontalLicenses
Confined to service(s)
and technology defined in old license
New licensees may enter market
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Determination of Licensable Activities
Ownership or operation of
network facilities
Provisionof basic
connectivity & bandwidth to enable
transport of communications
between points
Provision of a particular
function or capability to end user(s)
Provision of content services
What is the activity?
Network FacilitiesProvider
NetworkServicesProvider
ApplicationsServicesProvider
ContentApplications
ServicesProvider
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Licence Categories
Individual Licenses
• Content applications service provider
• Applications service provider• Network service provider• Network facilities provider
Class Licenses (Current)
• Applications service provider
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-Earth stationsFixed links and cablesPublic payphone facilitiesRadiocommunications transmitters and linksSatellite hubsTowers, poles, ducts and pits used in conjunction with other network facilities
Network Facility Provider
-Bandwidth servicesBroadcasting distribution servicesCellular mobile servicesCustomer access servicesMobile satellite services
Network Service Provider
Audiotext hosting services provided on an opt-in basisDirectory servicesInternet access servicesMessaging servicesPrivate payphone serviceTelegram services
PSTN TelephonyPublic cellular telephony servicesIP telephonyPublic payphone servicePublic switched data service
Application Service Provider
-Satellite BroadcastingSubscription BroadcastingTerrestrial free to air TVTerrestrial radio broadcasting
Content Application Service Provider
Class (Current)IndividualLicensing Category
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Migration to the New Licensing Regime
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Transition Options for Licensees
Register existinglicense
Register existinglicense
Apply for newlicense
New licensegranted / refused
Old licensecontinues
Existing licensees have certain transitional obligations.
Licensee indicates intent to migrate or remain on existing
licenseIntention tomigrate to
new license
Intention toretain existinglicense
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The Steps to Convergence
Licensesissued by Dept of
Telecommunications
Licensesissued by
Ministry of Information
Register licensewith MCMC andindicate intentto migrate to
Minister
Licenses forconvergent activities
1 Apr 99 1 Apr 00 Phased
MCMC issues transitional
licenses for licenseesopting to migrate
and to new applicants
Old licenses not migratedcontinues until expiry
Licenses forconvergentactivities
New applications
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Categories of Licences
Individual Class Exempt
Licensed Unlicensed
Within the four markets, activities may fall into any of three categories for licensing purposes.
Only activities with significant economic or social impact are individually licensed.
The long term objective is to move into less regulation.
Less regulation
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Network Facilities
Network Services
Applications Services
Content Services
The old licenses that were issued based on specific technologies, and
specific services map onto
New technology-neutral and service-neutral
licenses
Licensing Migration
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Licensing Migration Scenarios
Existing operators may require more than one license. But service-specific licenses such as licenses for broadcasting and ISP will no longer be issued. This, however, does not restrict the licensee from describing itself as a broadcaster or a telecommunications service provider. These are commercial decisions.
LicenseeA
LicenseeB
LicenseeC
LicenseeD
INTERIM RESTRICTIONS
Some restrictions may apply in the interim. The reasons for these include the following:
• To ensure the orderly growth of the convergent sector
• To take into account commitments already made to some existing licensees; significant investments have been made on the basis of these commitments.
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Licensing Environment under the CMA 1998
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Registration For Class Licence
APPLICANT COMMISSION MINISTER
SubmitsForm D
Acknowledge;Check for
completenessProcess
Qualifies forregistration
PaymentRegistrationCopy of licence
IssuesClass licence
Issuesnotification
Does notqualifyNotified
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Process For Individual Licence
APPLICANT COMMISSION MINISTER
Submitapplication
Acknowledge;Check for
completeness
Processand
RecommendDecision
Registerand
Inform
Issuelicence
Notgranted
Licencegranted
Informedof reasons
for rejection
s.30(3)
s.30(6) – s.30(8)
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Fees Payable & Licence Tenure
5 or 10 yearsTenure
RM25,000Renewal fee
0.50% or 0.15% of Gross Annual
Turnover (minimum RM50,000)
Annual licence fee
RM2,500Annual registrationRM50,000Processing fee
RM2,500Registration feeRM10,000Application fee
CLASS LICENSEES
INDIVIDUAL LICENSEES
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Individual Licence
No. of licencesissued
Licence Category
19592322
Content Application
Service Provider
Individual Licence (CASP)
Application Service Provider
Individual Licence (ASP)
Network Service Provider
Individual Licence (NSP)
Network Facility Provider
Individual Licence (NFP)
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Licensing Environment
Generic provisions of Act apply to all relevant activities
Standard license conditions commonto Individual and Class licences
Standard LicenceConditions common
to Individual Licences
Specialconditions
Undertakings
Individual Class Exempt
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Standard Conditions For Class Licence
1. Permitted activities2. Sole licence3. Compliance with the law4. Compliance with the
numbering plan, the electronic addressing plan, and Consumer Codes
1. Safety measures2. Charging mechanism3. Indemnity4. Fees5. Change of particulars of the
registration notice
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Standard Conditions For Individual Licence
1. CorporateA. IncorporationB. Share holding, JVC. Sole licence for activityD. Compliance with CMA
2. Indemnity3. Change in licence
condition
1. OperationsA. Numbering plan, electronic
addressing, spectrum planB. Consumer codeC. RatesD. Safety measuresE. Charge mechanismF. Licence fees
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Special Licence Conditions (Examples)
1. Obligation to provide Universal Service And/Or To Contribute To Universal Service Fund- The licensee shall comply with any
determination made by the Commission on universal service provision.
- CONTRIBUTION TO USP FUND: - All licensees except Content
Application Service Provider (CASP)
- Licensees whose annual total revenue derived from designated services exceeds RM500,000
- Contribution is determined at 6% of the total weighted net revenue from designated services
2. For all individual licensees [Reg. 18]
A. Notify the Minister of any restructuring or rationalization of the individual’s corporate structure
3. Additional for CASP(I) [Reg. 22(2)]
A. Provide local content programmes and those that promote Malaysian culture and national identity
B. Carry public announcements for the purposes of the government or for public or national interest.
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USP Overall Objectives
network services and/orapplications services
by encouragingthe installation of network facilities
and the provision of network services and/or
applications servicesin underserved areas
orfor underserved groupswithin the community.
WHAT
FOR WHICH
SERVICES
WHERE
HOW
FOR WHOM
To promote the widespreadavailability and usage of
throughout Malaysia
To set targets and timelines.
Basic communications services, initially focusing on public payphones, basic telephony and internet access services.
USP funding to be provided to incumbents in brown field areas and successful bidders in green field areas.
Through collective access (e.g. payphones) or individual access (e.g. residential phones).
STATEMENT OF OBJECTIVE OPERATIONALISING THE OBJECTIVE
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UNIVERSAL SERVICE OBJECTIVES
Underserved Area is defined as an area where the penetrationrate for basic telephony is 20% below the national penetration rate
22% (Current National Penetration Rate)
17.6% (20% below National Penetration Rate)
PenetrationRate
Underserved Area
Highly Served Area 100 %
80 %
20 %
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UNIVERSAL SERVICE PROVISION : UPDATES
1. Ministerial Direction Universal Service Provision 1/2000, 1/2001
• Direction from Minister to determine a system of the USP
2. Commission Determination on Universal Service Provision 2/2001
• Outlines the mechanism of USP in the country
3. Underserved areas identified throughout the country
4. Areas for roll-out in 2002 identified and bid documents issued
5. Project implementation by 4th Quarter 2002
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MCMC as a Convergence Regulatorfor the entire communications and
multimedia industry
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MCMC as a Convergence Regulator
1. Apart from implementing the Communications and Multimedia Act 1998, MCMC is also has jurisdiction over the following Acts:
A. Digital Signatures Act 1997B. Postal Services Act 1991
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1. To exercise regulatory functions including the determination of performance standards and standards of facilities and services and the enforcement thereof;
2. To ensure the licensees comply with their license terms and conditions;
3. To promote competition in providing for postal services;4. To promote the interests of users such as the prices to be
charged, the continuity of postal services and the quality of the postal services;
Postal Regulatory : Role & Functions
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5. To secure all reasonable demands for postal services are satisfied;
6. To promote and encourage the expansion of postal services with a view to the economic development of Malaysia;
7. To regulate the fixing of rates to be charged in respect of postal article;
8. To regulate the fees and commissions on postal financial services; and
9. To regulate the issuance of postage stamps.
Postal Regulatory : Role & Functions
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Postal Licensing Regime in Malaysia
1. The Postal Services Act (PSA) 1991 governs the postal services industry in Malaysia. Regulations based on the Postal Act:
I. Postage Rate Rules; andII. Post Office Rules
2. The PSA (Amendment) 2001 came into effect on I November 2001. This Amendment Act empowers the Commission to regulate the postal services industry in Malaysia.
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The Digital Signature Act 1997
1. DSA 1997 came into effect on 1st October 1998.2. It requires mandatory licensing whereby a
company that Wishes to operate as a Certification Authority (CA) must be licensed first.
3. The Regulator of the DSA is the MCMC – Controller of Certification Authority.
4. The DSA 1997 enforces legal recognition to digital signatures and gives the same force of law as hand-written signatures.
5. The DSA 1997 also outlines the main standards and minimum requirements of operating as a CA.
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Regulator’s responsibility…
1. Oversee and regulate the operations of CA s, Repositories and Date/Time Stamping Service in Malaysia;
2. Ensure that licensed CA s, recognized Repositories and recognized Date/Time Stamping services maintain a high level of integrity and quality in rendering their services;
3. Determine and coordinate CA trust model in Malaysia; and
4. Determine cross-certification policies with foreign CA s.
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Digital Signature : Licensing Framework
ControllerController
Date/Time StampServices
CertificationAuthority
Repository
Certificate of recognition
Certificate of recognitionLicense
• Digicert Sdn Bhd • Digicert Sdn Bhd • MSCtrustgate .com Sdn Bhd• Bank Negara (Restricted)
• Digicert Sdn Bhd • MSCtrustgate .com Sdn Bhd• Bank Negara (Restricted)
1. Two stages for CA license and recognition of repository/ date/ time stamp service:A. The establishment stage; andB. The operation stage.
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Conclusion
1. The communications and multimedia sector in Malaysia now operates under a converged Act and a single convergent regulator.
2. The new licensing structure, which is technology and service neutral, makes it easy for license holders to provide new services as and when technological development enable these services to be provided.
3. Licensing framework reflects the principles of promoting the national interest, transparency, less rather than more regulation and flexibility to foster industry’s dynamism.
4. MCMC is a convergent regulator overseeing the entire communications and multimedia industry, including the postal services and digital signatures.
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Thank you
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MALAYSIA
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