Telecommunications/ transportation substitution and energy conservation: Part 1

The substitution of telecommunications for transportation is held to have major potential for increasing energy conservation within the USA, other developed nations, and even developing nations. This article is the first of a two-part re-examination of the substitution hypothesis based on research and experience of the past decade. This part examines the theoretical potential of telecommunications-transportation substitution for energy conservation, and reviews recent research both on public attitudes towards substitution of telecommunications for travel and on the operational experience with substitution experiments in organizations. Part 2, which appears in the June 1982 issue of Telecommunications Policy, examines the major factors which influence whether individuals and institutions will in fact choose telecommunications over travel, and then discusses government policy which could facilitate telecommunications substitution for travel.     

Different paths to universal access: The impact of policy and regulation on broadband diffusion in the developed and developing worlds

The authors examine the broadband digital divide by analyzing the impact of policy and regulation on broadband Internet diffusion. Their multiple regression analysis shows factors that determine broadband diffusion in technologically developed countries do not necessarily have the same impact in less developed countries. They show that in technologically developed countries, there is greater broadband diffusion in countries that make a higher financial investment in information and communication technologies (ICTs), have effective governing practices at the national level, have higher levels of education, and are more urban. In technologically developing nations, a competitive telecommunications sector and higher investment in ICTs lead to greater broadband diffusion, with investment having an even larger impact in the developing world than in the developed world. In addition, stronger democratic political institutions, higher levels of national income and lower levels of income inequality increase diffusion, but the presence of a national telecommunications regulatory authority has a negative impact. These results suggest that the path to widespread availability and use of broadband requires different strategies depending on a nation's level of technological development.     

Financing and other issues in telecommunications development

Implementation of telecommunications infrastructure throughout developing countries is a prerequisite to national development. The fundamental question, argues Dr Parker, is how can developing countries pay for the capital investment in the necessary telecommunications equipment. The need is to encourage an institutional structure that can stimulate innovative, lower-cost appropriate rural telecommunications technologies without imposing excessive risks on the national telecommunications monopoly. With sucessful models to follow, it will be easier to achieve consensus between developing country borrowers, international lenders and telecommunications manufacturers.     

Accounting rates in the Caribbean: Finding a balance

This Comment examines the issue of telecommunications accounting rates in order to gain an understanding of the current relationship between the USA and the Caribbean nations. The initiative taken by the Federal Communications Commission on this issue will either increase the region's dependency status or protect US telecommunications carriers that handle Caribbean traffic. The present status of FCC accounting rate policy is restrained. This works in favor of Caribbean nations. If the USA and the nations of the Caribbean work together a more reasonable accounting rate will result for both.     

Lessons from broadband development in Canada,Japan, Korea and the United States

Broadband network development does not always track closely a nations overall wealth and economic strength. The International Telecommunication Union reported that in 2005 the five top nations for broadband network market penetration were: Korea, Hong Kong, the Netherlands, Denmark and Canada. The ITU ranked the United States sixteenth in broadband penetration.Aside from the obvious geographical and demographic advantages accruing to small nations with large urban populations, broadband development thrives when it becomes a national priority. Both developed and developing nations have stimulated capital expenditures for infrastructure in ways United States public and private sector stakeholders have yet to embrace. Such investments have accrued ample dividends including the lowest broadband access costs in the world. For example, the ITU reports that in 2002 Japanese consumers paid $0.09 per 100 kilobits per second of broadband access compared to $3.53 in the United States.Economic policies do not completely explain why some nations offer faster, better cheaper and more convenient broadband services while other nations do not. This paper will examine best practices in broadband network development with an eye toward determining the optimal mix of legislative, regulatory and investment initiatives. The paper will track development in Canada, Japan and Korea as these nations have achieved success despite significantly different geographical, political and marketplace conditions. The paper also notes the institutional and regulatory policies that have hampered broadband development in the United States.The paper also will examine why incumbent local exchange and cable television operators recently have begun aggressively to pursue broadband market opportunities. The paper will analyze incumbents’ rationales for limited capital investment in broadband with an eye toward determining the credibility of excuses based on regulatory risk and uncertainty. The paper concludes with suggestions how national governments might expedite broadband infrastructure development.     

On the role of telecommunications in development

Numerous studies document the relationship between telecommunications and economic development. The main types and relative merits of these are summarized. The paper argues that more of the same will do little to help promote accelerated telecommunications investment in developing countries as needed. Rather, the efforts should now mainly concentrate on conveying existing sector knowledge to governments and international agencies. The paper focuses on examples of simple, proven tools which can be used to supplement telecommunications project analysis for this purpose.     

Appropriate telecommunications for economic development

A vision of improved telecommunications infrastructure leading to dramatic improvements in the economies and the quality of life in developing countries is now supported by an increasing body of evidence. Economic justification of the necessary investment depends on the availability of appropriate low cost technology, such as microprocessor-based digital satellite earth stations costing under $10000. Such technology is technically feasible, but its availability will depend on the emergence of a consensus among telecommunications lenders, borrowers and manufacturers that the benefits can be achieved and therefore the necessary mass market will emerge.     

Financing telecommunications for rural development

Evidence shows that there has been serious underinvestment in telecommunications facilities in developing countries (DCs). This article analyses the reasons for this neglect, and demonstrates that a major restrictive factor in the development of telecommunications facilities in DCs — particularly in rural areas — has been the absence of adequate foreign exchange financing. Through an analysis of three major mechanisms for financing investment — supplier credits, multilateral lending and bilateral lending — and of the policies of the major institutions involved, the article identifies those policies that will stimulate the expansion of rural telecommunications in DCs.     

WTO principles and telecommunications in developing nations: challenges and consequences of accession

The accession to the World Trade Organisation (WTO) of developing nations brings into sharp relief the successes and shortcomings of the General Agreement on Trade in Services, which attempts to balance the concerns and interests of developed and developing nations alike. This paper reviews some of the key social and economic issues that arise in the field of telecommunications generally and specific issues facing developing countries arising from WTO accession and implementation of WTO principles. Lastly it considers the WTO decision in the US–Mexico dispute.     

Implications of deregulating satellite communications

Following the divestiture of AT&T, US policy makers have focused attention on means of increasing competition in international telecommunications markets. Several policy changes have been made by the FCC to deregulate international satellite communications. International concern has been aroused by the Reagan administration approval of alternative international satellite systems. INTELSAT and PTTs fear the systems will permit multinational corporations to bypass them, shifting the cost burden onto individual users and developing nations. While there are risks to be avoided, the potential effects of the private international satellite systems have been exaggerated by supporters and opponents.     

The impact of trade liberalization in telecommunications services: The case of APEC countries

This paper examines the impact of liberalizing the telecommunications services sector on investment and output in the Asia-Pacific Economic Cooperation (APEC) countries by estimating a system of four structural equations that takes into account the causal relationship between national income and telecommunications infrastructure. The degree of openness to trade in telecommunications is represented by a carefully constructed index that reflects a country’s trade and investment policy in terms of market access, national treatment and regulatory principles. One interesting finding from the empirical analysis is that the effects of trade liberalization depend on the risk rating of a country. In countries with relatively high risk ratings liberalization reduces investment in telecommunications.     

Telecommunications in the land of the Thunder Dragon: recent developments in Bhutan

This paper charts the development of telecommunications in Bhutan. Since the introduction of telecommunications services in 1963 Bhutan has faced many challenges as it has sought to roll out a network that covers the whole population and country. A small population, a mountainous geography, a transitional economy and a unique approach to development—Gross National Happiness—present many challenges that need to be overcome if the telecommunications industry is to develop further. Added to this is the decision of Bhutan to join the outside world through membership of the ITU, APT and WTO that has added liberalisation and privatisation to the challenges faced by Bhutan. This paper identifies two broad policy options that Bhutan could adopt—network expansion nationally or investment concentration towards urban areas. The authors conclude that due to the limited resources available to Bhutan these policies are contradictory and will take the telecommunications industry in quite different directions if adopted.     

Telecommunications and investment decisions in the Philippines

This article is a rejoinder to the article written by R.J. Saunders published in the December 1983 issue of Telecommunications Policy on investment decisions in telecommunications. The author, in this brief paper, attemps to discuss the decision-making process in telecommunications investments described by Saunders and as it relates to the practical experience of the Philippines and other developing countries in a similar situation. Attention is given to how the national telephone programme in the Philippines is being developed. Efforts have been exerted to identify the similarities and basic differences of the Philippines to other developing countries.     

Competition and telecommunications infrastructure in Ireland: A trade union perspective

The Communication Workers' Union is opposed to competition in telecommunications infrastructure on the grounds that such competition would place the national operator, Telecom Eireann, in an impossible position, having regard to the enormous historic cost of developing the existing network and the requirement to invest a further £800 million over the next five years. It also believes that to duplicate investment in infrastructure would be inefficient in national terms and points to the 900 or more airliners parked in the world's deserts as an example of the type of stranded investment that can arise when competition is taken too far.     

‘Mainline’ telecommunications infrastructure, levels of development and economic growth: Evidence from a panel of developing countries

This paper assesses the growth impact of telecommunications infrastructure investment in developing countries by subjecting country-specific data on mainline tele-density and per capita growth to a Granger causality test within a panel cointegration framework. The results suggest that growth effects vary widely across country groupings reflecting different levels of development. Mainline tele-density and per capita growth strongly reinforce each other for countries that are relatively less developed. The reinforcement effect is even stronger for emerging countries that can be identified by their higher than average growth rates. In contrast, there is, at best, weak evidence of bi-directional causal links between the two variables for countries that are relatively more developed. These differences in the mainline tele-density and per capita growth relationships suggest that investment in telecommunications infrastructure, with its potential to generate high growth return, may serve as the critical tool for driving the growth and development process forward in the less developed countries.     

The effects of international telecommunication investment: Wireline and wireless technologies, 1993–1998

In the 1990s, nations in the world from Singapore and Egypt to France and the United States poured billions of dollars into investments in information and telecommunication technologies. This article examines the effects of telecommunications investments from 1993 to 1998 using a model, which suggests that a delay in learning and adjustment is realized before the benefit and that it is (1) the transfer of information and knowledge and (2) the experience with telecommunications technology that contribute to economic performance of a nation. The research addresses the use of both traditional wireline and emerging wireless telecommunications and a nation's investments in telecommunications. The article concludes with a discussion of the results as well as the implications of the proposed learning model.     

Satellites: silent partner for LDCs

Historically, industrialized nations and international organizations have given the most tangible forms of assistance to the developing world. Direct shipments of food and medical supplies, creation of technical training schools, and low-interest loans for transportation improvements are typical examples. The positive effects on the lives of those who benefit are easily seen and understood, both by the government of the recipient nation and by the donors. A less visible, but critical ‘silent partner’ in aid programmes has been improved telecommunications.     

Public private partnerships as a tool for stimulating investments in broadband

The paper is concerned with PPP in the telecommunications area and more specifically with the combination of public and private investments in upgrading broadband infrastructures. Following the liberalization of the telecommunications area, investments were primarily left to the private sector – though public investments have continued to take place in specific areas such as research and education networks and rural and otherwise underserved areas. Lately, however, governments have upgraded their public investment plans in broadband infrastructures. The question is whether we are witnessing a simple quantitative change or whether this quantitative change includes a qualitative evolvement in the view on the role of the public sector in expanding broadband infrastructures. At the present time, the most likely answer is that increasing public investments in broadband infrastructures signal a combination of concerns raised by the economic crisis and the growing awareness of the social and economic importance of efficient broadband infrastructures.     

Telecommunications in developing countries

The conditions in which telecommunication services are established and expanded in the developing countries are very different from those experienced in the industrial nations. The author provides insight into the peculiarities of the telecommunication sector in developing countries, discussing characteristics related to the structure of the sector, system size and quality, telecommunications as a business, limitations to faster growth, and some particular problem areas, including the impact on economic development, especially in rural areas, training and education directed towards high technical and managerial positions, and the manufacture of equipment.     

Structural separation versus vertical integration: Lessons for telecommunications from electricity reforms

Structural separation between network and retail functions is increasingly being mandated in the telecommunications sector to countervail the market power of incumbent operators. Experience of separation in the electricity sector offers insights for policy-makers considering telecommunications reforms. Despite apparent competitive benefits, the costs of contracting increase markedly when short-term focused electricity retail operations are separated from longer-term generation infrastructure investments (which require large up-front fixed and sunk cost components). The combination of mismatches in investment horizons, entry barriers, and risk preference and information asymmetries between generators and retailers leads to thin contract markets, increased hold-up risk, perverse wholesale risk management incentives, and bankruptcies. Direct parallels in the telecommunications sector indicate exposure to similar complications, intensifying many of the contractual risks arising from regulated access arrangements. Thus, as in electricity, competition between vertically integrated telecommunications providers would likely induce more efficient and sustainable investment and competition than would separation.