International Handbook of Network Industries
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International Handbook of Network Industries

The Liberalization of Infrastructure

Edited by Matthias Finger and Rolf W. Künneke

This extensive, state-of-the-art Handbook provides a comprehensive overview of the various experiences of liberalization across different sectors, regions and disciplines.
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Chapter 7: Liberalization in the Telecom Sector

Willia H Melody


William H. Melody INTRODUCTION The liberalization process in telecommunication has evolved through several distinct phases of reform. It has proceeded at an uneven pace, not only across different regions and countries, but also in the implementation of specific policy reforms within countries. The main forces driving reform have varied among regions and countries, as have the particular methods of regulation adopted in attempting to implement liberalization policy objectives. But the fundamental policy goals of telecom liberalization have been remarkably similar, differing primarily in the priorities given to particular policy goals in the overall liberalization agenda. The general, although far from universal, positive results from early experience in the USA and the UK, and the strong advocacy from these countries and international agencies for liberalization in other countries, has stimulated the export of a variety of liberalization policies, institutional arrangements and regulatory practices to most other countries. The basic principle underlying liberalization reforms has been opening access to telecom networks that had previously been monopolized to the detriment of participation of new players. The essential policy objectives have been to foster the extension of networks for greater coverage (universal access), to stimulate the introduction of new network technologies and services, and to introduce competitive efficiencies in the provision and pricing of services. But liberalization has been a far more complex and much slower process of institutional change than was initially anticipated. The policy issues at each stage of the reform process have been hotly contested among incumbents, new entrants, equipment manufacturers,...

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