The Telecom Regulatory Authority of India (TRAI) issued a consultation paper titled “Encouraging Innovative Technologies, Services, Use Cases, and Business Models through Regulatory Sandbox in Digital Communication Sector. The paper presents a draft sandbox structure for live testing of new digital communication products or services in a regulated environment. TRAI seeks comments from stakeholders on several parts of the framework.
What is digital communication?
Digital communication is the use of internet tools such as email, social media messaging, and texting to communicate with other people or a specific audience. Even something as easy as viewing the content on this webpage qualifies as digital communication.
Aim of Paper
- Frameworks are intended to support regulators’ desire for innovation while also ensuring economic resilience and consumer protection. Considering this, the Department of Telecom (DoT) asked TRAI to offer recommendations on a regulatory sandbox framework. TRAI approaches the issue with the goal of encouraging creativity and hastening the adoption of cutting-edge digital communications technologies.
- Artificial intelligence, the Internet of Things, edge computing, and other emerging technologies are revolutionizing how we connect, communicate, and access information, driving the digital communication sector to rapidly expand. To keep up with this dynamic environment, an enabling environment for the development and deployment of novel technologies, services, use cases, and business models is required.
- The regulatory sandbox concept is becoming increasingly popular around the world as a means of encouraging innovation in a range of industries. A regulatory sandbox is a regulated environment in which businesses and innovators can test their concepts, commodities, and services while operating under changing restrictions.
- Regulatory Sandbox will benefit the telecom startup ecosystem by providing access to a real-time network environment and other data, allowing them to evaluate the reliability of new applications before releasing them to the market. Regulatory Sandbox also attempts to stimulate cross-sectoral collaboration for carrying out such testing by engaging the assistance of other ministries and departments in order to give the starting company with a single window for acquiring all clearances.
What is regulatory sandbox?
- A regulatory sandbox is a controlled regulatory environment in which new products or services are tested in real-time.
- It serves as a “safe space” for businesses because authorities may or may not allow certain relaxations for the sole purpose of testing.
- The sandbox enables the regulator, innovators, financial service providers, and clients to perform field testing in order to gather evidence on the benefits and hazards of new financial innovations, while closely monitoring and mitigating their risks.
What are the advantages of having a regulatory sandbox?
- Firstly, regulators obtain first-hand empirical evidence on the benefits and risks of emerging technologies and their implications, allowing them to form an informed opinion on the regulatory changes or new regulations that may be required to support useful innovation while mitigating the associated risks.
- Second, sandbox customers can evaluate the viability of a product without the need for a wider and more expensive roll-out. If the product appears to have a high chance of success, it may be authorized and delivered to a wider market more quickly.
Digital communication sector and Regulatory Sandbox
- Many countries’ regulatory organizations have built sandbox settings for telecom tech innovation.
- These frameworks are intended to encourage regulators’ desire for innovation while also promoting economic resilience and consumer protection.
- In this context, the Department of Telecom (DoT) had asked TRAI to give recommendations on a regulatory sandbox framework.
- Written comments on the drafting framework will be received until July 17, 2023, and counter-comments will be taken until August 1, 2023. The Authority’s goal in the digital communication industry is to foster creativity and expedite the use of emerging technologies such as artificial intelligence (AI), the Internet of Things (IoT), and edge computing. These technologies are changing the way individuals connect, engage, and access information, causing rapid changes in the industry.
According to TRAI, these technologies are changing how individuals connect, engage, and obtain information, resulting in significant changes in the sector.
The regulatory sandbox also wants to stimulate cross-sectoral collaboration for carrying out such testing by engaging the assistance of other ministries and departments in order to give the starting company with a single window for acquiring all clearances. The consultation paper covers some of the worldwide regulatory sandbox frameworks in use in the digital communication industry, as well as some of the frameworks in use inside the country in other sectors.
Author: Himanshi singh Associate, Advocacy & Policy CPF