CHANAKYA NATIONAL LAW UNIVERSITY

THE CONVERGENCE
THEORY
CYBER LAW PROJECT

BY
MR. KUMAR GAURAV
SEMESTER

SUBMITTED
SUBMITTED TO
Minakshi kumari
5 TH YEAR, IX
FACULTY, CNLU
ROLL NO 561

ACKNOWLEDGMENT
I would like to give my sincere thanks to our respected Cyber Law Faculty, Mr. Kumar Gaurav
who has guided me all the way in completing this project and enlightening me from time to time
in understanding the technicalities pertaining to the project
I would also like to give sincere thanks to our librarians who have helped me all the way in
searching through the source materials and guiding me in my research work at the library.
The list couldnt be completed without thanking all my friends and family who have encouraged
me in successful accomplishment of this project and been a pillar of support all through the
completion of the project.

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RESEARCH METHODOLOGY

Aim and observation

The aim of my project is to provide a detailed study of the topic, THE CONVERGENCE
THEORY
Research method
I have adopted a purely doctrinal form of research. I have collected all my information from the
library and the internet.
Type of study
I have used the descriptive method of study. Descriptive research aims to gather data without any
manipulation of the research context. In other words, descriptive research is also low on the
control or manipulation of research context scale like my topic
Source of data
I have collected all my information from Secondary sources
Books
Internet.

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INTRODUCTION
Benjamin Lipschitz1
Network Convergence is the merging of the communications, distribution and
information-processing networks - telephony, cable and broadcast, electric and gas
utilities, and the Internet and other computer networks, both wired and wireless, through
which today's communications flows, to provide the most efficient transmission of all
visual and aural forms of information in digital form.
Technological convergence has had transformative effects in the television sector. The
development of alternatives means of transmission, such as satellite, cable, ADSL or Fibre,
brings about new challenges, unforeseen in legacy sector-specific regulation. First of all,
television activities can no longer be regulated in the abstract, as it is a source of competition
among convergent service providers. In the same way that cable and telecommunications
companies compete for broadband Internet subscribers, they also compete for the acquisition of
premium television content. As a result, a comprehensive regulatory framework devised to
promote competition in the Electronic Communications sector at large will always be
incomplete, for as long as television content remains excluded from its scope, as it is currently
the case in Europe (but not in the United States). Secondly, most of the assumptions underlying
legacy sector-specific regulation no longer hold true. Justifications for regulation based on
market failure arguments have become suspect with technological developments, such as
conditional access systems. More importantly, legacy sector-specific regulation was adopted in a
context of outlet scarcity where television operators activities could be easily monitored and
where strict conditions for the licensing of activities were justified insofar as they constituted a
quid pro quo for the use of a public resource, the radio spectrum.2
1 Regulatory Treatment of Network Convergence: Opportunities and Challenges in the Digital Era 7 Media L. &
Policy 14 1998-1999

2 Pablo Ibez Colomo, The Impact of Technological Convergence in the Television Sector: Towards a
Single Technology-Neutral Regulatory Framework. A Comparative Legal Analysis of Institutional and
Substantive Issues in Europe and the U.S. available at
https://www.law.stanford.edu/sites/default/files/project/204963/doc/slspublic/Colomo_Abstract.pdf (Last
Page | 4

FACTORS
"Factors such as technological innovation, changes in the market, and developments in
regulatory reform are all serving to create an entirely new, overlapping marketplace for basic
services such as telecommunications, electric, gas, etc. These factors have further propelled
companies to enter into strategic alliances, joint ventures, and in some cases, mergers, which
enables them to offer a menu of product options to customers and to operate their systems more
efficiently. This is commonly referred to as 'convergence.3
Convergence refers to the coming together of the underlying mechanisms broadcasting,
telecommunications and the Internet-that are used to deliver content and services. Within
broadcasting, convergence has traditionally referred to channel proliferation and the provision of
radio and television over digital distribution mechanisms, such as wireless, digital cable, satellite,
or the Internet. Similarly, the telecommunications sector has long used the term to describe the
coalescence of telecommunications technologies: telephone and cable, telephone and the
Internet, wireless and the Internet, and telecommunications and broadcasting. In the context of
the Internet itself, convergence refers to the development of an interconnected broadband
communications system, a 'network of networks', over which service providers will carry voice,
data and video. The present-day conception of convergence incorporates these ideas and more.
Virtually any innovation having a cause or effect relationship with another aspect of
communications technology can potentially be described in terms of convergence. As it concerns
telecommunications and related industries, convergence can be traced to two basic changes in
technology. First, fibre optics, digital compression and packet switching have allowed
communications technologies to escape the constraints of dedicated telecommunications circuits
and a limited broadcasting spectrum by creating theoretically limitless transmission capacity.
Second, advances in the cost and speed of computer processing and memory have vastly
accessed November 4, 2014)
3 Consumer Energy Council Of America Research Foundation ("Ceca/Rf") Convergence Forum ("Ceca/Rf
Convergence Forum"), Case Study: Regulatory Convergence (Visited Nov. 5, 2014)
<Http://Www.Cecarf.Org/Projects/Convergence/Cs-Regulatory.Html>. The Ceca/Rf Convergence Forum Was
Created To Examine The Issues And Implications Relating To The Convergence Of The Gas, Electric And
Telecommunications Industries. See (Visited Nov. 5, 2014) <Http://Www.Cecarf.Org/Welcome2.Html>.

Page | 5

increased the level of interactivity of which communications technologies are capable.4 These
changes have had their most profound effect on communications at the network level, where the
use of compressed digital information packets, instead of dedicated circuits or spectrum
frequencies, has produced a means of providing point-to-point, point-to-multipoint, and
multipoint-to multipoint communication simultaneously-a task that formerly required separate
networks.' Telecommunications and broadcasting have benefited from these advances through
access to an increased range of services and distribution methods. The quintessential
convergence medium is the Internet, which is technologically capable of providing traditional
telecommunications and broadcasting as well as an array of interactive services ranging from
electronic mail to electronic commerce. There is, however, another aspect to technological
convergence. As methods of content delivery converge, the standards and protocols that underlie
the delivery mechanisms and end-user products tend to diverge.5 In other words, while
convergence encourages functional integration, it typically produces a plurality of distribution
technologies and consumer devices.6 This is because convergence invariably gives rise to
contests over the manner in which new technological avenues are exploited, spurring innovation
and creating new markets. High-speed Internet communications, for instance, can now be
conducted using cable, telephone, satellite, terrestrial wireless," and even public utilities."
Conceptually, each of these technologies is a new market in which multiple providers might
operate. High-speed Internet technologies also collectively represent a new market that
challenges the former means of connecting to the Internet, and may in turn be challenged by new
technologies. Until the market chooses winners an operation undermined by constant
technological change convergence is likely to be accompanied by considerable divergence and
fragmentation.7
4 D.J. Collis et al., "Winners and Losers: Industry Structure in the Converging World of Telecommunications,
Computing and Entertainment" in D.B. Yoffie, ed., Competing in the Age of Digital Convergence (Boston: Harvard
Business School Press, 1997) 159 at 160.

5 Ibid at page 160

6 Ibid
7 J. Mitchell, "Convergent Communications, Fragmented Regulation and Consumer Needs" in W.H. Melody, ed.,
Telecom Refonn (Lyngby, Denmark: Den Private Ingenicrfond, Technical University of Denmark, 1997) 441.

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SOCIAL IMPLICATIONS
Converging technologies will be of the type of the expensive high tech activities and products,
and they will me et with reactions, particularly by developing countries, similar to the reactions
to other high tech developments in the North. The expensive converging technology applications
will aggravate problems of access to health services and, again, raise costs o f social security
systems. Access for whom? For all? Or for the ones who can afford the new therapies, devices,
etc? Which services should be covered by public funds, in the democratic societies of the
European Union? They can hardly be withheld in these affluent countries, or restrictions in one
system will increase the mobility of Europeans to other countries for purposes of health
delivery.
Converging technologies belong to dual research efforts, i.e., to research oriented towards and
applicable to both military and civilian uses. Moral standards apply equally to military and
civilian research or technology applications. At least, that is the intention when paying respect to
ethics. Still, history has taught us that standards, national regulations, a nd even international
legal norms are negated or suspended in times of war or military conflicts. As converging
technologies might or will revolutionize arms and warfare in the long run, they will add to
existing dangers, possibly by starting a new kind of arms race. The definition of combatants and
arms is likely to change, if devices are not visible. Similar to chemical and biological weapons
banned by the CTBTO Treaty, or possible attacks on information infrastructures and on non
-renewable resources, processes and products of converging technologies will initiate new
international treaties. Products of converging technologies will equip terrorists with new
weapons. And last, converging technologies are scientific and technological fields in progress. W
ill European countries be open for the advances, or - as was often the case in the past - restrict or
bar new frontiers of research and industry? Will ethics be used as a pretext? Will there be a
balance of values, freedom of research and industrial entrepreneurship on the one hand, and
human rights and science ethics, on the other? Creativity, curiosity and courage are not the
opposites of respect for ethics; disrespect and negligence are.
Agenda items for integrating social sciences and humanities: a host of issues in social
security and public health delivery systems, in international law.

ETHICAL IMPLICATIONS
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Converging technologies will accentuate or lead to new interpretations of known ethical issues
and positions. For this, there exist sufficient guidelines, or appropriate guidelines that have been
recently developed for research (funding) with a view to improving human health. At any rate,
there is sufficient knowledge available to identify or structure the problems. Perhaps converging
technologies will also pose new questions. Human integrity and/or autonomy might be affected
in new ways; borderlines between therapies and enhancement or interference with heal th,
between drugs and devices might be blurred. Interferences might occur involuntarily, or might be
forced on persons. Recent European discussions on science ethics concentrated on the beginning
of life, including the use of embryonic stem cells and permitting or excluding prenatal
interventions, and on the end of life, or rather ending the life of human beings (euthanasia).
In certain aspects, converging technologies will touch upon the human life from the beginning to
the end of life. They will or might interfere with, or change, or enhance, or control personality,
personal integrity, and personal identity. They will raise the question of a contrary right to
imperfection, i.e., of personally accepting or refusing physical and mental challenges and
personal fates, which are aspects presently debated in European philosophical circles, with a
possible consensus to label the aim of human enhancement as a science for constant beauty,
i.e., as negative expression of the zeitgeist, and not as a science in the service of health.

LEGAL IMPLICATIONS
Converging technologies are expected to challenge human rights, in particular human dignity,
the right to life, privacy, in some respects also the right to the protection of health. In legal
terms, interferences with or intrusions into the human body and mind are prohibited; of course,
the rule has exceptions. Among private persons permission and consent will suffice unless
criminal acts are intended or carried out; in the relationships between persons and the state
authorities, interferences are permitted if certain criteria are met, such as lawful punishment, or
crime prevention, or protecting life, security or health of third persons. Referring to this legal
maxim must suffice here. The conceivable revolutionary aspects of the new technologies might,
indeed, support such a view and do call for a monitoring process right from the beginning, with a
view to examining the legal matters and to discuss appropriate new legal norms if necessary, de
lege ferenda. As presently interpreted, the fundamental rights will most likely not provide proper
solutions to all human rights questions posed by converging technologies.

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Finality refers to the goals or purposes of the research programmes, such as binding research
efforts to the aims and service of health improvement. Soft law regulations are codes of
conduct, written into governmental, or more often into non governmental conventions, or
professional standards. The conditions of individual cases do require interpretations, usually
within a frame of general norms or based on legal principles, such as finality or proportionality.
Examples are: adjudicating cases involving interests of babies, children, old, or sick or
handicapped people for whom curators, trustees, etc., are charged with the special care that
dependent persons need.

COMPETITION LAW and CONVERGENCE

Assuming this proposition is true, it might seem a foregone conclusion that technological
convergence would stimulate competition in the industries it affects. Yet the prevailing business
response to technological uncertainty has been to integrate previously discrete industry sectors
and enterprises, which in turn has often limited competition. In a sense, the convergence of
communications technologies has caused a parallel convergence of the communications
industries themselves, and of the firms that comprise them. This phenomenon can be explained
in several ways. In part it has to do with the wide range of sectors that technological convergence
has involved or affected: not only telecommunications and broadcasting, but also computer
hardware and software, telecommunications equipment, entertainment and media. Another factor
is that technological convergence ultimately creates content neutrality: because all network
traffic is packaged in the same way, as digital 'bits,' networks cannot necessarily distinguish
between a private telephone call and a television broadcast.'4
The fact that new network technologies function to eliminate geographical borders and will
eventually make communications inexpensively available everywhere 5 also motivates the
business response. Businesses are lured as well by technological grand designs-of which the best
example is that the converging technologies will eventually come together as "a seamless
network of voice, data and video services" that is invisible to users.8
Several non-technological motivations can also be identified for the pursuit of structural
integration in the communications industries. First is the widespread privatization, liberalization,
and deregulation of telecommunications services in North America and Europe, particularly in
8 P.R. Parsons & R.M. Frieden, The Cable and Satellite Television Industries (Boston: Allyn & Bacon, 1998) at 12.
Page | 9

the last five years. A second motivation is the increasing number of start-up companies with
underexploited technologies that face barriers to market entry when trying to launch a product
theirselves, but are vulnerable to acquisition by larger enterprises with ample investment capital.
Third, firms have sought to take advantage of synergies that can be created by combining talents
and resources from multiple converging sectors.'9 A horizontal acquisition gives both the buyer
and the target instantaneous access to expertise in each other's business area. In addition, the
desire to enter global markets and to profit from scale economies has placed a high value on the
compatibility of equipment and systems standards, a potential by-product of technological
convergence and a virtual certainty within integrated enterprises.'10
An important market reality triggering industry concentration is the phenomenon of repurposing:
the maximization of revenues from technological convergence through content repackaging and
brand exploitation. Repackaging occurs when content developed for one media form is
repackaged for sale in other forms or distributed on new delivery systems. The purchase of film
studio libraries for use on pay television movie networks is one example of repurposing that is
considerably facilitated by vertical integration. Other examples include the use of digital
animation programming in electronic games, and location-based entertainment such as theme
parks.'11 Brand exploitation takes repurposing one step further, involving the adaptation of
content across media forms behind a single marketable character or idea. 12 Thus a book becomes
a movie, spawns a television series, and is accompanied by a merchandising campaign of toys,
hats, lunch boxes, and fast-food promotions. An interactive Web site generates interest in
income-generating aspects of the brand. Especially within vertically integrated enterprises, these
ventures foreshadow a decline in the linear, image-based advertising forms characteristic of print
9 C.R. Blackman, "Convergence between telecommunications and other media: How should regulation adapt?"
(1998) 22:3 Telecommunications Policy 163 at 164.

10 R.A. Cass & J. Haring, Izternational Trade in Telecommunications (Washington, D.C.: AEI Press, 1998) at 188.

11 Parsons & Frieden, supra note 8 at 199; National Research Council, Keeping the U.S. Computer and
Conunuiications Idustry Competitive: Convergence of Computing, Communications and Entertainment
(Washington, D.C.: National Academy Press, 1995) at 30.
12 E. Duncan, "A Survey of Technology and Entertainment" The Economnist (21-27 November 1998) 6.

Page | 10

and broadcasting media, and the rise of interactive, Web based advertising that "can begin with
the image, present the user with hard factual comparative] data...and then complete the sale with
an order for the advertised product."
The consequences of technological convergence for industry activity and structure are several.
Most obvious are line-of-business changes, in which companies that were previously engaged in
one business branch out into others, where they may encounter experienced players or
completely new entrants. In conceptual terms, a transformation is occurring between the discrete
vertical businesses of telecommunications, broadcasting and computing and the closely-tied
horizontal industry segments' of content, packaging, distribution, manipulation, and end-user
terminals. Technological convergence has also helped many of the former or 'incumbent'
telecommunications monopolies in North America and Europe to become aggressive
international players.Multilateral Competition Policy under the WTO
The challenge of obtaining the benefits and reducing the threats to competition in
telecommunications has been particularly pronounced at the international level. From the
standpoint of economic theory, a barrier-free global telecommunications market will amplify the
benefits observed in any single domestic market or in a regional cluster such as North America or
Europe. International competition, however, has been frustrated by the lack of uniformity among
domestic structures for the regulation of competition, and by the absence of a supranational
competition authority. It has also been tempered by foreign ownership limitations, addressed
later in this article. These roadblocks were the impetus for the negotiations on basic
telecommunications conducted under the auspices of the World Trade Organization (WTO)
following the Uruguay Round and concluded in February 1997. The WTO negotiations were the
first successful multilateral talks directed at trade issues within a single services sector. Together
with the main text of the negotiations arguably signify "the emergence of a rudimentary
international competition law governing telecommunications."
Despite their billing, however, the multilateral negotiations and the GATS itself offer few
concrete assurances of uniform competition policy in telecommunications. The main text of the

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GATS,13 as adopted in 1994, contains a national treatment principle that requires each WTO
Member to treat the services and service suppliers of other Members no less favourably than its
own. But national treatment only applies where a country has made a specific commitment to
admit competition in a particular sector, and thus offers guidance but little certainty of freer
trade. Similarly, Article II of the GATS contains a most-favoured-nation (MFN) provision,
requiring that concessions extended to one service or service supplier must be extended to all.
Unlike national treatment, MFN applies whether or not a WTO Member has made an express
commitment to admit foreign competition. MFN obligations can be circumvented, however,
since a WTO Member can file an exemption.14
The GATS Annex on Telecomnniunications was meant to elaborate on provisions in the main text
that are too imprecise to be applied with any consistency. Its core provisions offer some
safeguards designed to counter the tendency of established suppliers either to refuse
interconnection to new entrants or to provide it on unfavourable pricing or technical terms. At the
time the Annex was negotiated, however, "few countries appeared interested in opening up their
basic

telecommunications

monopolies

to

domestic

competition,

let

alone

foreign

[competition]."15 As a result, the Annex addressed access to telecommunications services mainly

as a conveyance mechanism for other services. The negotiations on basic telecommunications
were noteworthy in that they focused on telecommunications not as a conveyance mechanism,
but as a service in its own right. Furthermore, they elicited express national commitments on
competition issues in the form of national schedules that were appended to the GATS as the
Fourth Protocol. The commitments achieved in the national schedules of February 1997 owe
13 General Agreement on Trade in Services, contained as Annex l (b) to General Agreement on Tariffs and Trade Multilateral Trade Negotiations (The Uruguay Round): Final Act Embodying the Results of the Uruguay Round of
Trade Negotiations, 15 December 1994, 33 I.L.M. I [hereinafter OATS].

14 The general text of the GATS includes other provisions relevant to competition in telecommunications: Article
Ill, which requires regulatory transparency; Article VI, concerning the formulation and administration of domestic
regulation; and Part IV, which mandates the ongoing reduction or "progressive liberalization" of trade barriers in
services sectors. Negotiations on basic telecommunications were undertaken in part to fulfil the expectations of this
latter provision

15 Reference Paper on regulatory principles used for consideration as additional comntitments in offers on basic
telecommunications, WTO Negotiating Group on Basic Telecommunications (24 April 1996), online:
<http:llwww.wto.org/wto/press/refpap-e.htm> (last accessed on November 10, 2014 1997) [hereinafter Reference
Paper].

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much to a document known as the Reference Paper, 76 which provided a template for
commitments regarding anti-competitive behaviour," interconnection78 and several other
regulatory issues.16 The Reference Paper itself,80 however, was not included in the Fourth
Protocol. And while the commitments in the national schedules were binding, they were also
voluntary."' As a legal prescription for competitive international trade in telecommunications
services, therefore, the GATS regime offers few guarantees. Certain aspects of the agreementssuch as the vagueness of competition provisions," the voluntary nature of national commitments
in the Fourth Protocol, the ability to file exemptions, and the opportunity to phase in changesmight prevent the GATS from achieving perfect liberalization, independent of questions about
technological convergence. On the other hand, the momentum both captured and accelerated by
the negotiations is likely to reinforce existing voluntary commitments and lead to further
commitments by a larger group of nations. The result may be that the legal status of multilateral
commitments is not finally determinative.
COPYRIGHT LAW AND CONVERGENCE
Copyright law has by and large been formulated according to principles of "technological
neutrality." It has focused on the nature of the use of the work, rather than the medium by which
the use is accomplished, or the physical facilities or equipment involved. Thus, the law has
granted to authors the rights to reproduce the work, to adapt it, to perform it publicly, and to
communicate it to the public. The primary exception to this technological neutrality has been the
separation of a broadcasting right from the general right of communication to the public.3 But
the convergence itself, does not change the fact that a work is or is not being exploited, reaching
the public as a copy, a communication, or a combination of both.
Nevertheless, convergence is of course relevant to copyright. The same forces that give rise to
convergence have also given rise to problems for the copyright model of technological neutrality:
16 Section 3 provides that universal service policies are not per se anti-competitive, but must be "administered in a
transparent, non-discriminatory and competitively neutral manner" not more burdensome than necessary. Similar
limits were imposed by section 6 for the allocation and use of scarce resources. A third principle, transparency, was
addressed in respect of public availability of procedures for interconnection (sub-section 2(3)), actual
interconnection agreements (sub-section 2(4)), and, implicitly, the disclosure of technical and commercially relevant
information by a major supplier to its competitors (sub-section 1.2(c)). A fourth general concept was regulatory
independence. Sub-section 2.5 provides for the adjudication of disputes over interconnection by an "independent
domestic body". Section 5 contains a broad directive that the regulatory body be "separate from, and not accountable
to, any supplier of basic telecommunications services."

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the techniques and media have changed to such an extent that rights drafted to be neutral and
capacious may either no longer fit, or may fit too much. It has therefore become necessary to reexamine the question of what rights should exist in which works, and how they can be enforced
and licensed, in order to maintain meaningful incentives and appropriate balances. In other
words, the causes of convergence may also lead to a potential convergence of separate rights in
the copyright "bundle" and a shift in the established boundaries, categories and roles of copyright
law
BENEFITS AND DRAWBACKS OF TECHNOLOGICAL CONVERGENCE
Massive opportunities for the development of new value-added services, convenience, efficiency
and the expansion of consumer choice are offered by technology convergence. It expands the
overall market for ICT and related services, and is likely to be the catalyst for the next stage in
the integration of the world economy. Moreover, it is giving rise to new intelligent products.
Information technology is turning machinery, equipment, cars and household appliances into
more than data processors. Hooked up to communication networks, they can also exchange data
with other devices. As a result, work sequences whose results depend on very many previously
isolated single elements can be optimized. Smart homes and new transport technology in
automobiles are good illustrations. With the benefits come new policy and regulatory challenges,
such as the protecting consumer interests (including competition laws), intellectual property
rights, setting of manufacturing standards, facilitating cyber-trade, controlling emerging cybercrime, reduction of traditional jobs and other public issues.

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INDIAN CONVERGENCE LAW

The dawning of the 21st century seems to have had a magical effect on India. The Indian
Government has taken the emergence of the new millennium as a signal to proceed forward in
the direction of wholeheartedly adopting technologies and giving legal recognition to the same
and regulating the same.
This new chapter began with the passing of India's first Cyberlaw namely, the Information
Technology Act, 2001 on 17th May 2000. Immediately, thereafter, the Government embarked
upon the move to regulate the convergence industry given the impending scenario of
convergence of technology. Keeping this end in mind, the Government came across numerous
drafts on The Convergence Bill in the country which were open to public debate on the web
before final tabling The Communication Convergence Bill, 2001 in the lower house of the
Parliament in the recently concluded Parliament session. As convergence is an all-encompassing

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phenomenon, it is important for us to analyse in detail the new proposed Indian Convergence
Law.17
CONVERGENCE BILL
Pursuant to the recommendations of an expert group, the Government of India
(hereafter "GOI" or "Government")

has

recently

completed

and

released

draft

Communication Convergence Bill, 2000 that aims to provide a clear regulatory framework for
keeping pace with the convergence of telecom, Internet and broadcasting services occurring
worldwide. This new legislation, drafted along the lines of an amendment to the U.S.
Telecommunications Act of 1996 and Malaysias 1998 Multimedia Act would make India the
second country in the world after Malaysia to adopt legislation covering the convergence of
high-tech media.
One of the most notable features of the Bill is the creation of the Communications Commission
of India (hereafter the "CCI" or the "Commission") and the consolidation of Indias ministries
of Information Technology, Communications, and Information Broadcasting. The Commission is
proposed to be established as the regulatory authority in convergence of Information Technology,
communications and broadcasting, and is expected to be responsible for managing the spectrum,
granting of licenses and enforcing their conditions, determining tariff rates and ensuring a
competitive marketplace.
The Bill, and eventually the Communication Convergence Act, is expected to repeal a number of
legislations such as the Indian Telegraph Act (1885), the Indian Wireless Telegraphy Act (1933),
the Cable Television Networks (Regulation) Act (1995) and the Telecom Regulatory Authority of
India Act (1997). The proposed law would be short, with detailed rules and regulations
promulgated by subordinate legislation so as to cope with rapid changes in technology, and to
address problems faced by the industry as and when they arise. Delegated legislation is to be
provided by the Central Government and Commission to implement the provisions of the
proposed Act in letter and spirit. In order to avoid the vice of excessive delegation, the Bill
17 Pavan Duggal, Indian Convergence Law Cyberlaw.net available at
http://unpan1.un.org/intradoc/groups/public/documents/APCITY/UNPAN002089.pdf (Last accessed on
November 4, 2014)
Page | 16

provides that all rules and regulations framed under the proposed Act must be tabled before
Parliament for approval and modification.
Understanding Convergence
The term convergence has not been defined in the Bill. Convergence commonly refers to the
provision of different kinds of services over the existing infrastructure and the enhancement of
existing technologies so as to provide a wide variety of services. This results from the blurring of
borders between telecommunications, computing and media. Quite obviously, it is a term that
eludes precise definition and it is very difficult to formulate an exhaustive definition. Put simply,
it is the ability of different network platforms to carry essentially similar kinds of services. To
simplify further, it is the coming together of consumer devices like the telephone, television and
personal computer as progress is made towards the transmission of information, whether data,
sound or images over the same infrastructure.
For consumers, the convergence of technologies means the provision of various services like the
cable television, basic telephone services and Internet access, through a single infrastructure
resulting in the possibilities to make cheap phone calls over the Internet, using televisions to
access the Internet, downloading movies from the Internet, and to have e-mail, data and Internet
access over mobile phone networks, etc. The possibilities are endless!

Legal/Regulatory Issues in Providing Services Incorporating the Convergence

of Technologies
Regulatory challenges thrown up for the provision of convergent services are many. As in the
case of most countries, separate licenses have been issued in India for basic, cellular, ISP,
satellite and cable TV operators, each with separate industry structure, terms of entry and varying
requirements of creating infrastructure. However, the fact that convergence now allows operators
to use their facilities to deliver some services reserved for other operators necessitated a re-look
into the existing policy framework. In India, at present, different departments of the Government
regulate the Telecom, Broadcasting and IT industries differently. Whereas telecom services are
regulated by the Union Government through the Ministry of Communications, separate and
Page | 17

distinct licenses are required for Internet access services, basic telephony and cellular telephony
under the antiquated Telegraph Act of 1885. On the other hand, radio and television broadcasting
services are regulated by the Ministry of Information and Broadcasting under the Telegraph Act,
1885. New developments facilitated by the convergence of technologies, entailed this need for a
paradigm shift in the regulatory framework to encourage the adoption of convergent
technologies, and do away with differential treatment, resulting thereby in this effort to merge
regulations governing various services and remove the multiplicity of licensing requirements.
PROPOSALS OF THE EXPERT COMMITTEE
As mentioned earlier, an expert group was constituted in order to recommend changes to the
regulatory structure in the light of convergence. They made several far reaching
recommendations, which have been incorporated in the Bill.
The following are some of the salient features of the recommendations:

The proposed law to incorporate various aspects of the Broadcasting Bill, 1997, and to
supercede and merge various other statutes, such as the Telecom Regulatory Authority of
India Act, 1997, the Indian Telegraph Act, 1885, the Indian Wireless Telegraphy Act,
1933 and the Cable Television Networks Regulation Act, 1995.

The Telecom Regulatory Authority of India Act, 1997 to be repealed. However, neither
the functions of the Telecom Regulatory Authority nor the Appellate Tribunal constituted
thereunder would be abolished. They only stand transferred to and get incorporated into
the new enactment.

Constitution of a single and independent regulatory authority for broadcasting and

telecom services, namely the Communications Commission of India.

The Commission to continuously interact with various sectors of industry to help set
standards and formulate regulatory norms, both as to content and carriage of information.
It would be required to establish a licensing framework in the scenario of convergence of

Page | 18

telecommunication, broadcasting, multi media and other related technologies and set up a
single regulatory framework for carriage and information content.

The proposed law envisages the Commission initiating and establishing a regime of
"enforced self-regulation", that is, service providers being persuaded to establish
disciplinary regimes of their own to avoid the threat of formal legal intervention.

Frequency allocation in a fair and facilitative manner as the "frequency spectrum" is a

critical and scarce natural resource, to ensure that no single agency creates conditions
inimical to the growth of industry, and at the same time, preventing any compromise of
the countrys security requirements.

As regards licensing, the model adopted envisages separate categories of licenses for
network facilities, network services, application services and content application services
and not to restrict licensing to certain specific services only. This is to ensure that the
classification is both technology and service-sector neutral. The proposals also
contemplate a specific category of "composite licenses" that could be granted for
providing multiple telecommunication services or facilities. The proposal also envisages
the Government considering amendments to existing licenses.

The proposals also provide for the incorporation of social obligations or "Universal
Service Obligations". However, as the range of obligations and their character and
content would be different in different places and situations, left to be prescribed by rules.

OBJECTIVES
Under Chapter IV, the objective of the Bill is to create a regulatory environment that aspires to be
flexible enough to accommodate and propagate any permutation and combination of
technologies and services, without any attempts to predict the future. In order to achieve a
technology-neutral and service sector-neutral environment, the Bill outlines the creation of four

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categories of licenses that include network infrastructure facilities, network services, application
services and content application services.18
According to Section 19, the CCI while exercising its functions is required to be guided by the
following principles:

To ensure that a modern and effective communication infrastructure is established taking

into account the convergence of information technology, media, telecom and consumer
electronics.

To ensure that the communication sector is developed in a competitive environment and

that market dominance is suitably regulated. To ensure that communication services are
made available at an affordable cost to uncovered areas like rural, remote, hilly and tribal
areas.

To ensure that there is increasing access to information for greater empowerment of

citizens and towards economic development

To make sure that quality, plurality, diversity and choice of services are promoted.

To protect the security interests of the country.

To facilitate the introduction of new technologies, investment in services and

infrastructure, and to maximize communications facilities and services (including
telephone density).

To ensure equitable and non-discriminatory interconnection across various networks.

To ensure that licensing criteria are transparent and to provide for an open licensing
policy.

18 Government plans a super regulator for communications sector, The Economic Times,
September 7, 2014 available at http://articles.economictimes.indiatimes.com/2014-0907/news/53653044_1_super-regulator-communications-convergence-bill-telecom-ministry
(Last accessed on November 9, 2014)

Page | 20

To provide for a level playing field for all operators serving consumer interest.

Licensing Provisions and Technologies/Services to be regulated by the Bill

The Bill states that no person would be allowed to use any part of the spectrum without
assignment from the Central Government or the Commission (Section 3). Furthermore, no
person would be allowed to own or provide any network infrastructure facility, or provide any
network service, application service or content application service without a license granted
under the proposed Act (Section 4). In addition, no person is permitted to possess any wireless
equipment without obtaining a license (Section 30).
As per Section 26, Chapter VII, the Commission may grant license to any person for providing
the following services technologies/ services:
1. Network infrastructure facilities1;
2. Network services2;
3. Application services3; and
4. Content application services4.
It is expected that the classification mentioned above will be technology-neutral and service
sector-neutral since setting up an infrastructural facility and its use is not linked to the provision
of a particular service by using a particular technology. Therefore, services can be provided by
using any facility and any technology.
The Bill envisages that in an era of convergence, an application service provider or content
application service provider could utilize the services of any network service provider for
carrying their application/content. In turn, the network service provider would have the
flexibility to utilize the infrastructure provided by any network facility provider and to carry
application/content from any application service provider or content application service provider.
Similarly the network facility provider can provide the infrastructure to any network service
provider.
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POWERS AND FUNCTIONS OF THE COMMISSION

Main FunctionsAccording to Section 20, Sub Sections (1) and (2), the primary function of the Commission will
be to facilitate and regulate all matters relating to the carriage and content of communications.
Specifically, it shall be responsible for:

Carrying out management, planning and monitoring of the spectrum for commercial
usages.

Granting licenses, determining and enforcing license conditions and fees.

Determining appropriate tariffs and rates for licensed services.

Ensuring competition in the market, and that service providers do not become dominant
players to the detriment of other service providers or consumers.

Promoting competition and efficiency in the operation of communication services and

network infrastructure facilities.

Formulating and determining conditions for fair, equitable and non-discriminatory access
to a network infrastructure facility or network service such other related matters in
respect thereof.

Taking measures to protect consumer interests and to enforce universal service

obligations.

Formulating and laying down programme and advertising codes in respect of content
application services.
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Formulating and laying down commercial codes in respect of communication services

and network infrastructure facilities.

Taking steps to regulate or curtail the harmful and illegal content on the internet and other
communication services.

Formulating and lay down codes and technical standards and norms to ensure quality and
interoperability of services and network infrastructure facilities.

Carrying out studies on matters of importance to the consumers, service providers and the
communications industry.

Institutionalizing appropriate mechanisms to interact on a continual basis with all sectors

of industry and consumers.

Making recommendations on matters that the Central Government refers to it.

Adjudication of Disputes
According to Section 22, the Commission shall hear and decide complaints from any person
regarding contravention of the provisions the proposed Act, rules, regulations or orders made
thereunder. In particular, the Commission shall hear and decide:

Disputes between two or more service providers on issues relating to spectrum

interference, interconnectivity, denial of fair access and practices restrictive of fair
competition.

Disputes between a service provider and a group of consumers arising out of enforcement
of any provision of the proposed Act.19

In trying suits, the Commission shall have the same powers as are vested in a civil court under
the Code of Civil Procedure. It would not be bound by the procedure laid down by the Code of
19 Communications Convergence Bill, CUTS available at http://www.parfore.in/pdf/Bill-Blowup-12002.pdf
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Civil Procedure, but shall be guided by the principles of natural justice and shall have powers to
regulate its own procedure.
Regulation of Content of Communications
According to Section 21, the Commission is expected to specify programme codes and standards
that may include inter aliapractices:

To Ensure That Nothing Prejudicial To The Interests Of The Sovereignty And Integrity
Of India, The Security Of State, Friendly Relations With Foreign States, Public Order Or
Which May Constitute Contempt Of Court, Defamation Or Incitement To An Offence Is
Contained In Any Programme.

To Ensure Fairness And Impartiality In Presentation Of News And Other Programmes.

To Ensure Emphasis On Promotion Of Indian Culture, Values Of National Integration,

Religious And Communal Harmony, And A Scientific Temper.

To Ensure In All Programmes Decency In Portrayal Of Women, And Restraint In

Portrayal Of Violence And Sexual Conduct.

To Enhance General Standards Of Good Taste, Decency And Morality.

Conditions for Obtaining a License

The license can be for any one of the categories specified above, or may be in the nature of a
composite license - jointly for one or more categories. While granting a license, the Commission
may confine or limit the scope of the service to be provided. It may also specify by way of
regulations20:

Eligibility conditions for issue of licenses;

Cross-media restrictions having regard to accumulation of interest; and

20 Section 26
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Restrictions or otherwise on the number of licenses or extent of accumulation of interest

in such licenses by a person.

Conditions for the Grant of a License to use Wireless Equipment

Under Section 30, any person who intends to posses any wireless equipment must make an
application with the requisite fees to the Commission for the grant of a license. The Commission
is not to reject any application except on grounds of security of State, public order or other public
interest. Every license issued by the Commission shall be subject to such conditions and
restrictions as the Commission may determine by regulations.21
Duties Imposed upon Service Providers
The Commission may, from time to time, determine obligations, conditions, restrictions, tariffs
and rates subject to which the service provider shall provide services 22. As the range of
obligations and their character and content would be different in different places and situations, it
has been left to be prescribed by rules and is not provided for in the Bill.
The Bill specifies that every service provider shall:

Provide such services to give effect to universal service obligations that may be
prescribed;

Provide such life saving services that may be prescribed;

Provide service to any person on demand (within a reasonable period of time) and on a
non-discriminatory basis;

Follow the codes and standards laid down and specified by the Commission; and

21 Shauvik Ghosh, Communications Bill proposes to overhaul telecom sector Livemint, eptember 08,
2014 available at http://www.livemint.com/Politics/jqJCPIZrOk6t6GbXBwkVAJ/New-Bill-proposesrepeal-of-all-4-laws-that-govern-telecom-s.html?utm_source=copy (Last accessed on November 8, 2014)
22 Section 28
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Register with the Commission any shareholder agreements, promoters agreements or

inter-connectivity agreements.

In addition, every content application service provider shall:

Endeavor to provide a suitable proportion of programmes of indigenous origin; and

Ensure that none of its programmes infringes any copyrights.

Conditions for the Live Broadcast of Certain Live Events

In order to ensure the widest availability of viewing of national or international events held in
India, the Bill provides under Section 32 that no person shall carry a broadcast of any event in
India that has been previously notified by the Central Government, unless the public service
broadcaster has also been offered the broadcasting rights, on such terms as may be determined by
the Commission in advance of the bidding for the event.23
Governmental Intervention
In the event of war or any other natural calamity, the Central Government may take over the
control and management of any communication service or any network infrastructure facility
connected therewith, suspend its operation or entrust any agency of that Government to manage
it.24
Similarly, in expediencies, the Central Government may request the Commission to direct a
licensee to transmit announcements on its broadcasting service. It may also stop any
broadcasting service that is prejudicial to the sovereignty or security of India, friendly relations
with foreign States, or to public order, decency or morality, or communal harmony.
23 DoT begins work on convergence policy for communications sector, Livemint, August 21, 2013
available at http://www.livemint.com/Industry/JTOvPYfE0Ixk1y4jT3qAdO/DoT-begins-work-onconvergence-policy-for-communications-sec.html?utm_source=copy (Last accessed on November 4,
2014)
24 Section 72
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PENALTIES AND ADJUDICATION

Consequences of Breach of the Terms of the License

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The Bill proposes to levy a stiff penalty of Rupees 50 crores if a licensee commits fails to
observe any of the terms and conditions subject to which a license was issued. 25 The same would
apply to a failure to observe a rule, regulation or order made under the Act.
In addition, under the chapter the Commission may direct the licensee to do or abstain from
doing any act, suspend the license, curtail the period of the license, or revoke the license. It may
also authorize the seizure of the equipment being used for provision of such service. The
equipment cannot be retained for over ninety days without the approval of the Appellate
Tribunal.
As regards the consequence of providing communication services using unlicensed equipment, if
a person transmits any communication by the use of unlicensed equipment, or equipment which
is operated in contravention of the provisions of the proposed Act or any rules, or regulations
made there under, he shall be liable to a penalty which may extend to Rupees 10 crores.
As for the consequences of delivering content through unlicensed equipment, if a person delivers
content for transmission or accepts delivery of any content sent by the use of equipment which
he knows or has reason to believe is operated without a license or in contravention of the
provisions of this Act or any rules or regulations made thereunder, he shall be liable to a penalty
which may extend to 10 crores.
Failure to Register Agreements
Under Section 37, if a service provider fails to register an agreement which is required to be so
registered, for example, shareholder agreements, promoters agreements or inter-connectivity
agreements, he shall be liable to a penalty which may extend to Rupees 10 lakhs.
Failure to Comply with Orders of the Commission
Under Section 38, if a person willfully fails to comply with an order of the Commission, he shall
be liable to a penalty which may extend to Rupees 5 crores. In the event of a second failure, he
shall be liable to pay a further penalty of up to Rupees 10 crores. In the event of continuing
25 chapter X, Section 33
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failure, his penalty may extend to Rupees 2 lakhs for every day during which such failure
continues.
The Complaint Mechanism
Complaints to the Commission must be filed within 60 days of the occurrence of the event. If the
Commission believes that a prima facie case exists, it will refer the matter to the Adjudicating
Officer who would be an officer of the Commission. The Commission may suo moto refer
contraventions of the proposed Act to the Adjudicating Officer. In hearing the complaint and
deciding it, the Adjudicating Officer shall have the powers of a civil court in a number of
matters.
Calculation of Penalties
Under Section 41, while adjudging the quantum of penalty under this Chapter, the Adjudicating
Officer is to have due regard to the provisions of this Act as well as the revenue loss to the
Government, the amount of disproportionate gain, the loss caused to any person, the repetitive
nature of the default and that fact that the penalty must act as a deterrent.
The Appellate Structure
Under chapter XII, The Bill envisages the establishment of the Communications Appellate
Tribunal to hear appeals from orders of the Commission or Adjudicating Officer. The Tribunal is
expected to deal with matters expeditiously and dispose of matters within 90 days. In order to
discharge its functions, it is vested with many of the powers of a civil court. However, it shall not
be bound by the provisions of the Code of Civil Procedure, but shall have the power to regulate
its procedure guided by principles of natural justice. Appeals from the Tribunal shall lie to the
Supreme Court within 90 days. Decisions of the Tribunal shall be executable as decisions of a
civil court. Failure to comply with orders of the tribunal may lead to a penalty of Rupees 50
millions.
Bar on Jurisdiction of Civil Courts

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Under Section 79, the Bill excludes the jurisdiction of civil courts over matters which an
Adjudicating Officer or the Appellate Tribunal or the Commission is empowered by this Act to
determine. They are also prohibited from issuing injunctions against actions taken or to be taken
under the Act.

Conclusion
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We believe that the Bill represents a significant step forward in developing a future oriented
vision for Indias Information Technology, Communications and Broadcast industries. For a
country with a teledensity level well below both the Asian and global average, the proposed Bill
is significant in that it marks a major step towards revolutionizing telecommunications in India.
In initiating this Bill, India has made a great stride in developing a flexible regulatory
environment overseeing the converged interests of its Information Technology, Communications
and Broadcast industries. Furthermore, by continuing to develop innovative and forward thinking
regulatory strategies that promote industry led, market oriented developments in this essential
sector, India is positioning itself to become one of the leading destinations of the global
information economy, and a leading exporter of multi-media products and services.

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