This paper tries to explain from a multidisciplinary approach the theory of regulation in relation to Information and Communication Technology (ICT). The paper will also seek to discuss the advantages and disadvantages of relying on competition in the marketplace to regulate the ICT sector and the circumstances under which markets fail to provide desired outcomes.
It is known that each moment, new technological advancements are made in ICT. This effectively results in relatively new systems fast getting outdated. These rapid changes have necessitated the working staff to continuously seek more knowledge in order to keep pace with the times.
Those who cannot adapt to new ways as a result lose their jobs. The financial sector is one such sector that must continuously adapt to new ways in order to prevent and fight frauds that could easily be executed online. Developments in ICT have seen the introduction and successful use of credit and debit cards, automated teller machines, security equipment and advanced surveillance equipment all of which rely on computer technology.
Traditional regulatory frameworks have become increasingly inadequate for the rapid challenges such as convergence witnessed in ICT sectors in the world. This has been become a great challenge to regulatory bodies which have to adopt technology-neutral or equal regulatory treatment of the different communication and information infrastructure as a way of controlling the sector (ITU et al., 2009).
Regulation of ICT Sector
According to Baldwin, "Regulation as an activity can be described as a discrete and identifiable, focused and sustained exercise aimed at controlling activities that are valuable to a community by public agency or government" (Baldwin and Cave, 1999). Regulation may also be described as a deliberate set of commands, which are specific and take all forms of influence or social control, by a governing agency to control items that are valuable to the public (Baldwin and Cave, 1999).
Baldwin and Cave argue that regulation is one of the most controversial issues cutting across a host of disciplines including economics, law, political science, history, sociology, geography, psychology, social administration and management. Due to the apparent complexity of the issue of regulation, a multidisciplinary approach of the theories that exist must be taken (Baldwin and Cave, 1999).
The above fact can more easily be expressed by considering a simple example: if economists devised technically sound regulatory schemes they would prove to be of infinitesimal significance if warnings or challenges brought forward by sociologists and political scientists, pointing out reasons such schemes would not work as anticipated by the economists, are taken for granted. In similar way, lawyers' advices concerning limitations of certain enforcement processes and rules should be considered for the effective implementation of the scheme.
Regulations have existed in various forms to deal with a host of issues. The importance of regulation can be clearly seen in areas relating to industrial relations, monopolies, workplace safety and health, gaming, civil aviation,
and discrimination. Before setting up regulatory systems, issues such as