Report to NZNOG and ISOCNZ-Members This is a report back to these lists on the position taken by New Zealand at the APEC TELMIN conference in Cancun and outcomes from the conference. But first: as previously noted, the feedback from members of these lists has been very helpful in informing a NZ Government view. However, as a member of the NZNOG list has pointed out to me, despite the suitability for this type of discussion over a beer, the matters are somewhat off-topic for NZNOG. The Ministry of Economic Development wishes to undertake further consultation leading up to an ITU-T meeting and the next APEC TEL meeting in September. I will continue to send consultation material to the isocnz-members list. Subscribers to the NZNOG list who wish to continue to be involved should email me direct. I will assume that anyone responding to the previous round will wish to continue to be involved (unless you tell me otherwise ;) There has been some publicity from Australia and the US about the outcome of this conference which may have created some confusion as they tend to express alternative views on the outcome achieved. I have appended below a copy of a media release from the Acting Minister of Communications which gives the NZ perspective on the outcome. It should be apparent that the matter is not going to just fade away and we believe that the NZ government will need to continue to be actively engaged in the debate. The stance adopted by NZ at Cancun was as follows: <quote> (i) in principle, the costs of international circuits should be shared in proportion to the benefits. We are, however, unsure of the best way of assessing those benefits, and of whether there is a more efficient way of developing cost-sharing arrangements than commercial negotiations between interested parties, ie whether the benefits of government interventions to mandate particular cost-sharing formulae would exceed transaction and other costs; (ii) recommendations on specific international charging arrangements for Internet services are premature; (iii) in any case, recommendations in this area are more properly a matter for the ITU, not APEC. As the World Telecommunications Standardisation Conference is in October 2000, this would give more time for the consideration of issues such as the implications of voice over Internet; (iv) APEC principles could be a useful means of helping to clarify thinking on the issue, particularly if they emphasise the role of the private sector. We see the draft recommendations in the report as a useful basis for consideration; (v) recommendations for further TEL work are appropriate; and (vi) New Zealand will be in a better position to have considered the issue more fully by the time of the ITU World Telecommunications Standardisation Conference in October. </quote> Note that the position reflects economic orthodoxy ("in principle, the costs of international circuits should be shared in proportion to the benefits") but recognises the difficulty of achieving this. This is a fair summary of the feedback received, which covered both points. The recognition of the ITU's role in the issue was based on further feedback from the industry and reflects work done by a NZ private sector representative in that forum as well as recognition that if any regulatory regime were to be formulated promulgation would have to be through the ITU as APEC does not have this function and, in any case, it is not just an issue for APEC economies. The output documents from the Cancun meeting are something of a compromise reflecting the difficulty in finding positions that the two 'sides' could agree to. It was agreed that 'equitable cost sharing' did not necessarily mean 50/50 and it was acknowledged that the benefits arising from Internet traffic are hard to determine. The outcome from Cancun was as follows: <quote> Ministers also adopt the International Charging Arrangements for Internet Services attached as Annex B. Ministers also reaffirm the importance of cost-sharing or other mutually-beneficial arrangements for the region as a whole. </quote> In the Annex B, the key paragraph reads as follows: <quote> Internet charging arrangements between providers of network services should be commercially negotiated and, among other issues, reflect: a) the contribution of each network to the communications; b) the use by each party of the interconnected network resources; and c) the end to end costs of international transport link capacity. </quote> A longer statement was contained in the Programme of Action agreed by Ministers for the Telecommunications Working Group for the next 2 year period. The NZ suggestion that the matter might be more appropriately one for the ITU was not picked up. The only specific outcome is a direction for the Telecommunications Working Group to report back to the next ministerial meeting in China in 2 years time. By that stage, the ITU (which is a treaty-making body) will also have considered recommendations on the topic and the Internet itself will no doubt have continued its rapid expansion. Ministerial Press Statement: <quote> The Acting Minister of Communications Trevor Mallard has welcomed the progress made by APEC Ministers on international internet charging arrangements. The APEC Ministers met in Cancun, Mexico last week. Trevor Mallard said a reasonable compromise has been reached between the strongly held views of the US and Canada on one side, and the other APEC economies led by Singapore and Australia. "At the heart of the issue is a claim of unfair international internet charging," he said. "Many APEC economies believe those international charging arrangements are unfair because in relation to traffic exchanged with the US, the non-US party has to meet the costs of the international link in both directions. "New Zealand's position at the meeting was that, as a general economic principle, the costs of international internet circuits should be shared in proportion to the benefits to the parties. "Having said that it is difficult to assess the benefits from internet traffic, and we need to be sure that gains from the benefits of any government interventions in commercial negotiations would exceed the costs." "The International Telecommunication Union (a UN body which has treaty-making powers) is considering recommendations on this matter at its World Telecommunication Standardisation Assembly in September. "The Cancun Declaration issued by APEC Ministers at the end of the Mexico meeting reaffirmed the importance of cost-sharing or other mutually beneficial arrangements for the APEC region as a whole. "The principles adopted by Ministers, and the future work programme approved for the APEC Telecommunications Working Group, emphasise the importance of commercial negotiation and cost sharing". "It is too early to tell how the Declaration will impact on commercial negotiations, as APEC is not a treaty-making body, but this is still a valuable step in the right direction," Trevor Mallard said. New Zealand will continue to participate in the APEC Telecommunications Working Group. The group will continue to discuss international developments relating to the internet and report back to the next ministerial meeting in two year's time. </quote> Frank March Specialist Advisor, IT Policy Group Ministry of Economic Development, PO Box 1473, Wellington, NZ Ph: (+64 4) 474 2908; Fax: (+64 4) 471 2658 --------- To unsubscribe from nznog, send email to majordomo(a)list.waikato.ac.nz where the body of your message reads: unsubscribe nznog