Where markets are competitive, there will be no need for any regulatory intervention to promote interoperability because there will be a strong commercial incentive for operators to organise interoperability between themselves for services which require it. Interoperability and innovation 1.10 Another important consideration in identifying those services for which it is appropriate for there to be rules on interoperability is the trade-off between interoperability and innovation. This is also explored in detail in Chapter 3. The analysis in Chapter 3 concludes that the promotion of interoperability for certain types of service where the market is potentially distorted by an operator's market power will not act as a brake on innovation, and that, furthermore, this will only involve intervention to promote interoperability of services for which, in a competitive market, there would in any case be strong incentives for the industry to organise interoperability itself. 1.15 Interoperability of Co-operative Network Services is desirable both for customers, who want to be able to use these services in calls to other customers irrespective of whether they are directly connected to the same network, and for the development of competition.
Interoperability benefits the development of competition on two levels.
Firstly, between network operators because the unavailability of such services on small networks could unfairly hinder their ability to compete. 1.16 All Network Services need to work across customer interfaces so that customers can access the functionality in the network necessary to use the service. 1.17 Figure 1.1 illustrates how Network Services interoperate across customer interfaces, and Co-operative Network Services across network and customer interfaces. Copyright 1999 CMatt Communications.