Telecoms Liberalization Guide
Publication date : 01/10/2007
Telecommunications liberalization means introducing competition into the telecoms sector by allowing commercial enterprises to set up new telecoms businesses as long as they comply with certain government-defined policies, rules and regulations.
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It is a fundamental shift in the way a government, at the national level and through international treaty agreements, regulates the provision and use of public telecoms resources. Historically, telecoms infrastructure and services were provided on a monopoly basis with the plain old telephone service the main offering, and the government-owned PTT administration1 combining multiple roles as policy-maker, regulator and operator. Technological advances in computers and digital technology in the 1980’s and 1990’s, and flowing into our converging environment of the new millennium, has and will continue to radically change the telecoms sector, creating opportunities for market entry by a range of competitors. “What were once plain old voice networks are now seen as the central conduit of the information society, analogous to the canals and railways of the industrial society”. Governments have realized that monopoly networks and services were limiting the development of new markets and services. A legal or de facto monopolist will traditionally not be incentivized to introduce and offer new technologies or services as this increases operational cost and risk, which is typically not profit ma imising for the monopolist. The goal of furthering economic growth in the national market place and the desire to attract investment in the telecoms infrastructure became the catalyst for governments to start the telecommunication liberalization process.