Oxford Circus may have calmed down after the surge of Christmas and January sale shoppers, but there is one part of Regent’s Street where the level of activity increases all the time.

In our temporary offices the Ofcom Board and central project team are hard at work creating the new communications regulator that will, subject to final decisions from Parliament, take over from five existing communication regulators in the autumn.

Creating Ofcom is a huge task. But we have already made real progress.

Ofcom has a non-executive Board, drawing on a wealth of expertise from across the communications sector. The Board meets regularly and is heavily involved in the business of creating the new organisation.

For example, David Edmonds has led the team that found our permanent home on the south side of the River Thames and is ensuring we have the IS systems we will need.

We have a Chief Executive – Stephen Carter – who has extensive experience in telecommunications, broadcasting and advertising; and who is as excited as I am about the unique opportunity to create a new organisation that will make a real difference to the UK’s dynamic communications sector.

Ofcom also has a website – www.ofcom.org.uk – containing information on the organisation, and where documents will be published on Ofcom’s work. The first one will consider Ofcom’s strategic principles, and will be published in the Spring.

An immense amount of work has also been done by the Ofcom central project team and existing five communications regulators, to design a structure for Ofcom that will deliver the benefits of converged regulation for consumers.

There will initially be five areas of responsibility:

• Strategy and research – responsible for articulating Ofcom’s strategy and ensuring that Ofcom’s work is integrated into the strategy, underpinned by a robust evidence base.

• Content and consumer protection – dealing with broadcasting content, public service obligations and protecting consumers from anti-competitive practices.

• Competition and Markets – promoting competition across communications markets and the management of scarce resources, such as spectrum management.

• Regulatory operations – handling Oftel’s numerous dealings with the public and small businesses – whether issuing licenses, handling complaints or dealing with radio spectrum issues.

• Corporate services – managing the financial and business support services for Ofcom.

Now this work is well underway, the Board is turning its attention to the equally important task of agreeing Ofcom’s regulatory approach and key policy priorities.

Ofcom will be responsible for the regulation of broadcasting, telecoms and the radio spectrum markets. But, perhaps uniquely for a new regulator, we have been created to deal with the technological and market developments that are bringing these markets closer together.

We must create a new structure that adds value to the current regulatory process - and in a way that does not lose the many virtues of the regulators we are replacing.

It is particularly important that all of Ofcom’s stakeholders should be involved in this work.

The Board members and I have had meetings with a wide range of companies, consumer organisations and trade bodies, to discuss their ideas on how Ofcom can help the communications sector grow and thrive for the benefit of consumers and citizens. These meetings have been an invaluable source of information and ideas for us all.

Ofcom clearly can learn from the experience of the current communications regulators. Oftel’s work to create competitive telecoms markets, for example, provides us with a sound intellectual framework to address competition issues in the wider communications market.

People are already asking what sort of regulator Ofcom will be – to what extent will it intervene in markets?

There is no simple answer to that question – both now and in the future.

For example, in an established market, with a dominant player, regulation may well initially need to be tough and quite interventionist in order to create the conditions for competition to emerge. But as competition develops, Ofcom should be able to stand back and let market forces take over.

And new issues are always emerging – for example how do you tackle issues of market power in relation to ownership of content?

We are still some way from reaching decisions on these sorts of issues, but we do have some initial thoughts.

One imperative is that regulation must always be ‘proportionate’ – the minimum necessary to achieve the policy aim, but no more.

Another objective will be to seek to make regulation ‘dynamic in that our interventions should aim to create outcomes where regulation is no longer necessary, rather than getting locked into permanent regulation.

Another preference is that Ofcom should foster co-regulation where it can – allowing the industry to come up with its own solutions to common problems. Indeed this is more than a preference, rather a requirement of the Communications Bill.

More generally, where we do have to regulate, we will want to work with industry, consumer groups and others to find the most cost-effective regulatory intervention.

Ofcom will have its public policy objectives, just as every company it regulates has its own commercial objectives. But if industry understands the Ofcom objectives and has alternative ideas as to how they could be met, why not encourage that dialogue?

So I want to see close co-operation between the regulator and industry, consumers, consumer organisations and other stakeholders.

But I am not naïve. The interests of the regulators and the regulated do not always co-incide. And a company in a dominant position cannot be relied upon to provide a workable and non-regulatory solution to every problem. So Ofcom will be prepared to intervene swiftly and forcefully when necessary

The Communications Bill will place a specific duty on Ofcom to keep regulation under review. This is to ensure that it does not impose regulation that could become a burden on industry, or keep in place regulation that over time is in danger of becoming a burden.

I also want Ofcom to adopt the principles of transparency, openness and clarity, identified by the Better Regulation Task Force as necessary for effective and appropriate regulation. I know that these principles have served Oftel well.

Ofcom will, of course, have a number of key policy priorities. One of the more important will be radio spectrum management. It will be a key policy challenge as to how far and how quickly we can implement the Cave report on spectrum, which recommended the introduction of spectrum trading.

I want to see a move away from the current practice of central management for radio spectrum, and it replaced with a much more market-based approach. This will enable spectrum to be freely traded, so that it ends up in the hands of companies that can most quickly and effectively exploit that spectrum commercially. There are undoubted limits on how far markets can determine spectrum matters but we need to understand and test these limits.

How fully a market based model can operate, the best way to achieve this, and what backstop measures will be needed by Ofcom will be early questions that we will need to answer in testing our approach to regulation.

The Ofcom board members bring their own wealth of talent and experience from the communications industry. Although we are keen to learn from the existing regulators, we will challenge current thinking and practices if we think it is no longer appropriate or necessary.

We have already come a long way to create the new communications regulator, but there is still much to do.

My hope is that everyone involved in the communications business will contribute their ideas and thoughts. This way we will we be able to make the right decisions so Ofcom will support a thriving and competitive communications sector for the UK.