Governments can use policy instruments to either encourage or restrict the development of LOANs, as evidenced by the differing approaches taken on spectrum policy.

Spectrum policy can have a significant impact on the deployment of broadband services and the establishment of Local Open Access Networks, as evidenced by Wireless Fidelity (Wi-Fi) technology that can be used to provide Internet access in the 2.4 GHz and 5 GHZ bands.  Spectrum authorities in North America and Europe have designated these bands as unlicensed spectrum that can be used by anyone for the provision of WiFi services.  The availability of this spectrum has been one of the main reasons for the widespread deployment of Local Open Access Networks in these areas.

This situation is in contrast to many other countries, particularly in Africa and Latin America, where there are restrictions on the use of the 2.4 GHz and 5 GHz bands.  Proenza (2005) provides an overview of the situation in these areas noting:

“Information is sparse with respect to regulations on the use of bands that in the US and Europe are license free and that are fundamental to widespread deployment of Wireless technologies like WiFi and WiMax. Neto, Best and Gillet 2004 uncovered great heterogeneity in 47 African countries surveyed. Only in three counties, Rwanda, Lesotho and Tunisia, was the 2.4-2.4385 Hz band “license free”, in the sense this term is used in the US and Europe of requiring no license or registration; and only in Rwanda and Lesotho was the 5 Ghz (5.15-5.35, 5.47-5.725, and 5.725-5.875) band license free. In all other countries a broad range of restrictions potentially limit the use of these frequencies with respect to power, range and licensing. Galperin (2004) examines the situation in Chile, Peru, Mexico and Brazil, and finds restrictive regulatory requirements (e.g. outdoor use barred) for the 2.4 Hz band, with the exception of rural areas in Brazil.” [vi]

Proenza’s main argument is that VOIP and wireless technologies have a significant potential to extend affordable ICT services to rural communities in developing countries, however, there are often regulatory and governance obstacles restricting their deployment.  One of the main recommendations in his report is that:

“Donors and Governments committed to using ICTs to reduce rural poverty, would do well to focus on the liberalization of VoIP and VoIP interconnection to the PSTN and in the elimination of restrictions on the use of Wireless spectrum in the bands that enable WiFi and WiMax wireless networks (i.e. 2.4 and 5.8 Ghz bands).”[vii]

As noted by the experience in some developing countries, spectrum policy can and is being used to restrict the deployment of wireless systems that could be used to establish LOANs to provide affordable broadband services, particularly in rural areas.
 

As documented by Proenza (2005) the approach taken by regulators in a number of South American, Caribbean and Asian countries to restrict the use of VOIP to protect the revenues of the incumbent carriers provides a good example of how Governments can use regulatory policies as a means of inhibiting the deployment of new services and the establishment of Local Open Access Networks.
 

Spectrum policy is becoming more of a public issue in a number of countries, particularly in the United States, where there is a growing movement of people and organisations that are advocating greater liberalisation of spectrum management policies and the provision of more unlicensed spectrum for public use to facilitate more innovative applications.[viii]  In announcing changes to its spectrum policy, the U.K. regulator, Ofcom, noted that the benefits to the European Union from the introduction of new services, as the result of liberalisation and spectrum trading could generate as much as 9 billion euros annually.[ix]

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