As innovations continue to be rolled out across the satellite industry at a rapid rate, regulators are increasingly finding themselves playing catch up in accommodating these new technologies and eliminating unintended barriers.
Traditional frameworks that are too prescriptive or rigid are quickly becoming outdated, and this is prompting a shift among regulators towards more agile, adaptable approaches to unlock the local benefits that innovation brings. With new strategies required, the versatile ‘sandbox’ approach may provide the flexible regulatory environment needed to evaluate, test and refine new technologies before they’re launched.
Defining the concept
Initially developed in the Middle East, the regulatory sandbox approach enables regulators to directly engage with innovative technologies during their development phase, rather than after the launch date.
Through the approach, operators and innovators are provided with a controlled environment to test new concepts locally, while at the same time, regulators can customise market access conditions for any future commercial deployment, by evaluating key technical and regulatory concerns in real time. The freedom provided by regulatory sandboxes offers a less constrained workspace to help foster innovation, and ultimately expedite time to market.
The approach has been widely used across the communications and technology sectors, following previous successes in other leading sectors – such as fintech. This has more recently led to specific adoption within the satellite and space sectors.
Success in the Middle East
Space and satellite have remained at the forefront of Middle Eastern operations over the last decade, bringing expenditure to approximately $1.4bn in 2023. The region has also led the way in deploying the sandbox approach to accelerate innovation across technology and communications in recent years.
In 2021, the Telecommunications Regulatory Authority of Oman (TRA) issued Guidelines of Regulatory Sandbox Rules for Telecommunications, which was followed by Saudi Arabia’s Emerging Technologies Regulatory Sandbox in 2022. The latter aimed at achieving the goals set out in “Vision 2030” by supporting investors and companies in the country’s budding tech sector.
These types of initiatives – while not solely focused on satellite – have demonstrated how flexible regulation can enable technological innovation to flourish, in turn delivering the well-known societal and economic benefits nationally.
Worldwide adoption
The success of the regional sandboxes has led to broader adoption across the globe.
Earlier this year, ANATEL – Brazil’s regulatory authority – introduced its own sandbox to support advancements in satellite direct-to-device (D2D) applications specifically. As a result, temporary usage of certain spectrum bands can be authorised for D2D, and for longer than the existing trial licence regulations allow. The controlled environment provided by the sandbox is designed to help accelerate future deployment of D2D, while ensuring regulatory standards are met.
2024 has also seen the Government of Mongolia recognise the benefit of regulatory sandboxes, adopting the approach to facilitate growth in its expanding space sector. The technologies developed and tested within their sandbox will help attract further investment and bolster space operations within the country.
Additionally, a ground-breaking development was seen in India, with the Telecom Regulatory Authority (TRAI) also embracing the concept. Historically overseeing a stringent regulatory environment, the TRAI recently published recommendations that demonstrated a commitment to driving innovation, while balancing regulatory oversight.
Striving for innovation
The impact of sandboxes on satellite innovation is far-reaching. It promotes cross-sector collaboration because it offers a single window for obtaining clearances, while encouraging cooperation at a local level between different ministries and departments.
For the satellite innovators, the benefits are evident: regulators, operators, and key stakeholders can all identify potential challenges early in the development process and address these problems through testing well before launch. In parallel, this enhanced visibility means satellite operators can gain valuable insights into the consumer preferences and technology performances in specific global markets.
Adopting the sandbox approach is the first step, but a suitable strategy and methodology is needed to reap the rewards of the refined approach. By doing so, stakeholders have the potential to commercialise their new products and technologies quicker, fulfilling an ever-present priority – return on investment.
Looking to the future
It’s clear that the broader global adoption of the sandbox is demonstrating a shift to more collaborative and market-driven regulatory practices. This is especially notable in the area of 'Non-Terrestrial Networks (NTN)' - the driving force behind the integration and standardisation of satellite connectivity across terrestrial ecosystems - as more intricate regulatory tools are required to tackle the various regulatory and technical challenges this brings.
Sandboxes provide an environment conducive to innovation, growth, safety, and technology risk management. With early adopters demonstrating some remarkable successes, it can be expected that more regulators worldwide will join this trend. Especially to help spur innovation under wider policy agendas around growth, diversification and modernisation.
At River Advisers, we help satellite innovators navigate and engage in emerging sandbox processes across key regions. In doing so, helping to deliver market access support that is closely tailored to our clients’ goals and time-lines: bringing their next-generation technologies to global markets faster, and under the best possible conditions.
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