1. International Telecommunication Union IP Telephony ECTRA – APRII Meeting Berlin, September 26-28, 2001 Robert Shaw ITU Internet Strategy and Policy Advisor International Telecommunication Union The views expressed in this paper are those of the author and may not necessarily reflect the opinions of the ITU or its membership.

2. International Telecommunication Union Agenda Internet around the world IP Telephony: –Implications for high, medium and low-priced markets –Country case studies –What are the issues? –World Telecom Policy Forum 2001: IP Telephony Opinion D –Information resources ENUM & Convergence

3. International Telecommunication Union Source: ITU, adapted from Internet Software Consortium. Number of Internet host computers, in millions, and annual growth in %

4. International Telecommunication Union Top Internet Markets Top 10 countries by Internet user penetration, Jan. 2001 Top 10 countries by number of Internet users (millions), Jan. 2001 Source: ITU, Internet Software Consortium, RIPE.

5. International Telecommunication Union Inter-regional Internet backbone 357 Mbit/s 19’716 Mbit/s Asia- Pacific Latin America & Caribbean 2’638 Mbit/s 127 Mbit/s Arab States, Africa 468 Mbit/s 171 Mbit/s Europe 56’241 Mbit/s USA & Canada Source: TeleGeography Inc., Global Backbone Database. Data valid for Sept. 2000.

6. International Telecommunication Union IP Telephony: What is it? Internet Protocol (IP) Telephony is a generic term describing voice or fax carried over IP-based networks, such as the Internet. IP Telephony is important: –In the short-term, because it cuts the cost of calls, especially if routed over the public Internet –In the longer-term, because telecoms carriers are migrating their separate voice and data networks to converged IP-based networks Examples of IP Telephony Service Providers include Net2Phone, Dialpad.com, iBasis etc.

7. International Telecommunication Union IP Telephony Flavours Often treated differently from policy or regulatory perspective –Carried solely across the public Internet –IP is underlying transport or signalling technology for PSTN services (e.g., using SS7) –IP telephony on full end-to-end “private” IP networks (e.g., using “softswitch technology”) –Combinations of the above with gateways between Internet or private IP- based networks and the PSTN

8. International Telecommunication Union IP Telephony: Four main stages of evolution PC-to-PC (since 1994) –Connects multimedia PC users, simultaneously online –Cheap, good for chat, but inconvenient and low quality PC-to-Phone (since 1996) –PC users make domestic and int’l calls via gateway –Increasingly services are“free” (e.g., Dialpad.com) Phone-to-Phone (since 1997) –Accounting rate bypass –Low-cost market entry (e.g., using calling cards) Voice/Web integration (since 1998) –Calls to website/call centres and freephone numbers –Enhanced voice services (e.g., integrated messaging)

9. International Telecommunication Union Why is IP Telephony important? IP Telephony traffic, in million minutes 0.0% 0.2% 1.6% 5.5% 3.2% 0 1'000 2'000 3'000 4'000 5'000 6'000 7'000 19971998199920002001 As percentage of int'l outgoing traffic Source: ITU Internet Reports, adapted from TeleGeography Inc.

10. International Telecommunication Union Pricing IP for voice services In competitive, low-price markets –Main market opportunity for IP Telephony is for value-added services, e.g., unified messaging In markets in transition to competition –IP Telephony offers a route towards early introduction of competition and creates downward pressure on prices In high-price, monopoly markets –Where permitted, IP Telephony creates opportunities for low-cost calls –Even if not permitted, IP Telephony is widely used to reduce costs of international call termination

11. International Telecommunication Union Country positions on IP Telephony 189 ITU Member States As of March 2001. Based on responses to ITU regulatory questionnaire and inputs to WTPF-01. No policy or No response 98 Prohibited 35 Regulated if "real-time" 7 Unregulated, 26 countries Unregulated if not "real- time", 18 Light regulation 5

12. International Telecommunication Union Country case studies: IP Telephony legal status Source: Summary of ITU country case studies, available at: www.itu.int/wtpf/casestudies.

13. International Telecommunication Union WTPF 2001 on IP Telephony: What are the key issues? Technical: –How to define IP Telephony? –Is quality of service comparable? Will it improve? –How to handle numbering/addressing issues? Economic: –What price and cost savings can be expected? –How quickly will carriers migrate their networks? –Isn’t it just a form of bypass of telecom monopolies? Regulatory: –Is it voice or is it data? –License it? Prohibit it? Restrict it? Liberalise it? –Should IP Telephony contribute to Universal Service?

14. International Telecommunication Union WTPF 2001 Opinion D: Essential Studies to facilitate introduction of IP Telephony Invites the three ITU sectors to initiate studies to facilitate the introduction of IP Telephony on: –compatibility and inter-operability of radio access between IP networks and PSTNs, –working definitions of IP telephony and Internet telephony –whether, and to what extent, to require compatibility with the existing international telephone service, including developing appropriate performance metrics and QoS –Whether, and to what extent, IP Telephony can be part of national PSTNs and whether traffic identification and measurement need to be considered –identifying the cost elements of international IP connectivity with respect to the introduction of IP Telephony Invites the ITU-D to establish a group of experts to: –Prepare a checklist of Factors to be considered; –Advise on the policy impacts in developing countries; –Prepare a report to the next World Telecom Development Conf.

15. International Telecommunication Union Information resources ITU Internet Reports 2001: IP Telephony Secretary-General’s report (sole working document of the Forum) Chairman’s report (output of Forum) Website: www.itu.int/wtpf Country case studies: Canada, China, Colombia, Egypt, Korea (Rep.), Nepal, Peru, Uganda, etc

16. International Telecommunication Union ENUM & Convergence Problems of addressing calls that pass from one network service to another: –Now widely possible to originate calls from IP address-based networks to other networks –But uncommon to terminate calls from other networks to IP address-based networks –To access a subscriber on an IP address-based network, some sort of global addressing scheme across PSTN and IP address-based networks needed ENUM may be “glue” solution…

17. International Telecommunication Union ENUM Resolution DNS +1 202 456 1414 4.1.4.1.6.5.4.2.0.2.1.foo.tld Page:18001112223334445Page http://insite.whitehouse.comHTTP Tel:+1202 456 1414TEL Smtp:abc@xyz.comSMTP Sip:whitehouse@xyz.comSIP Service AddressProtocol ENUM converts an E.164 telephone number into a set of service addresses Client Software

18. International Telecommunication Union From Secretary-General’s Report to ITU Council 2001 ENUM potentially renews the question of the appropriate framework for management of naming and addressing in an increasingly converged telecommunications and Internet/IP environment. It is likely that implementation of ENUM may introduce further review of public policy objectives vis-à-vis the DNS and the E.164 numbering plan at national and international levels.

19. International Telecommunication Union Views of INTUG Possible that ENUM might have effects on some or all of the following: –integrity of national numbering schemes –competition between service providers –telecommunications network security –number portability –carrier selection –emergency services calls (including the passing of location information) –privacy –control over personal records –control of slamming

20. International Telecommunication Union Thank you…