The third-generation-mobile (3G) policy and deployment in China: Current status, challenges, and prospects

Since the inception of telecom reform in 1994, structural reform has been a main thread surrounding the course of the development of China's telecommunications industry. In structuring the 2008 reform and the 2009 3G rollout China's government adopted a relatively balanced approach in the hope of creating level-playing-field in 3G era. Nevertheless, due to the presence of substantial switching costs, substitution effects from the present technology mode, that is, 2.5G, the absence of killer applications, among other technological and institutional factors, China may not have a realistic 3G era before moving toward 4G and beyond. At the bare minimum, currently there is a lacking of either adequate technological-push or demand-pull for a full-scale 3G commercialization—there is no sign that this situation will change in the near term. Triggered by recent initiatives of market convergence between the telecommunications, Internet, and cable, a renewed circle of market, and regulatory reform is probably necessary to cast a sounder industry basis for a timing migration toward the next-generation-networks (NGNs). The timing migration toward 4G (and beyond) may provide a chance for a late-mover nation like China to leapfrog its western counterparts in leading the industry in the era of NGNs. To this end, China is confronted with a challenge in re-examining its industry policy as well as technological strategies for a sustainable development in the era of NGNs. This study offers heuristic analysis and insights on the above issues based on archival documents and interviews. While implications are suggested for China's circumstances, the Chinese experiences may also be considered by other countries and investors when it comes to 3G (and beyond) policies, regulations, deployments, and evolutions.     

Global political economy of technology standardization: A case of the Korean mobile telecommunications market

This paper examines empirical cases of standardization in the Korean mobile market as vehicles for approaching the broader political and institutional context of standardization in telecommunications. A consideration of Korean standardization in the mobile telecommunications market is particularly interesting because it reveals how the state's political interests influence standards decisions, which are primarily driven by market and technological changes in telecommunications. Judged from the social construction of technology perspective which sheds light not only on technology itself but also on political, social and economic interests that surround transformations in technology, this paper highlights power relations among the major actors that have made technology standards decisions in Korea regarding second (2G) and third-generation (3G) mobile telephony. The paper also attempts to show how the Korean government has dealt with the diverse interests of various market actors while pursuing its own policy agenda.     

The transformation of the mobile telecommunications industry in Pakistan: A developing country perspective

This paper offers a rare insight into the reality of the mobile telecommunications market transformation in Pakistan. Our analytical framework treats the mobile telecommunications market as a complex socio-technical system. Specifically, we define the telecommunications market as being composed of technology standards and three sets of social actors that include government institutions, network and service providers, and users. In the case of Pakistan, these social actors together determine the adoption of standards and services, and thus shape the trajectory of the market change. Our case study provides evidence that a pro-competition policy is imperative for mobile telecommunications development in developing countries, and an independent regulator is critical in promoting technological innovation.     

Trade patterns,industry structure and industrial policy in telecommunications

This article examines three major changes which have been occuring in the telecommunications market: liberalization, leading to increased competition in services and equipment, the internationalization of the equipment market, and a rapidly changing industrial structure. The interrelationship among the three trends is analyzed, and the authors hypothesize that it is the technological determinants which are driving the changing structure of the industry and its trade patterns and regulatory environment. The instruments of industrial policy are discussed, with examples from several countries. The European Community's policy in telecommunications is explained in some detail.     

Leveraging the EU regulatory framework to improve a layered policy model for US telecommunications markets

What is the best way to overhaul the current telecommunications legislative framework in the United States? This is an ongoing debate among telecom policy analysts and many others affected by the legacy of regulatory compromises that govern US telecommunications (and related information and media) industry sectors. This paper compares a Layered Model for US telecommunications policy with the regulatory framework adopted by the European Union. Both approaches focus on service characteristics rather than underlying technological traits.¹ It becomes clear that the Layered Model could be adopted to move away from sector-specific regulation, and could successfully use conventional market analysis criteria.     

基于DEA 模型的我国上市商业银行竞争力分析

金融业竞争的日益市场化与国际化以及基于技术创新的金融业快速发展,使得我国竞争力本来就不强的银行业深受冲击。因此,我国银行业必须不断提升自主创新能力,提高市场竞争力,以便构筑起可持续发展的能力。本文试图用数据包络方法(DEA) 对我国16 家上市商业银行竞争力进行实证分析,期望能够对我国商业银行竞争力的提升有一定的借鉴意义。     

APEC: steps to harmonising regional telecom policy

In spite of initial pessimistic analysis and observations, APEC has made sustained and collective efforts to overcome huge disparities in political, economic and cultural systems, and has achieved significant results in harmonising telecommunications policy and market liberalisation. This paper analyses how APEC member economies have overcome difficulties and have created unique approaches to establishing consensus and liberalising the telecommunications market in the region. Despite the current economic turmoil, APEC leaders are continuing in their efforts to advance the Asia Pacific Information Society (APIS). This paper also provides some perspectives on further development for the future.     

Institutional environment and complementary assets: Business strategy in China’s 3G development

This paper develops a framework to assess the influences of institutions and markets on the business strategy of firms in transition economies. We argue that regulatory systems and markets in transition economies are interdependent. Their changing conditions will interact and influence the types of partnerships in new market entry. Using a case study approach based on historical data and interviews, we show how China’s telecommunications industry evolved between 1987 and 2007, and led to the development of a 3G (third generation mobile telecommunications) standard and networks. Our analysis based on the framework explains how regulative elements and market conditions shape the strategic choices of partnerships between domestic and foreign firms when entering China’s 3G market.     

Technological and geographic heterogeneity in broadband markets: The challenge for regulation

When the telecommunications industry was liberalised in Europe and North America in the 1980s and 1990s, it inherited a legacy of monopoly providers whose footprint was national or multi-regional in its character. The regulatory framework, particularly that adopted in EU member states, reflected this pattern of relatively homogeneous deployment achieved, in part, by decades of cross-subsidised pricing and universal service goals. Perhaps because of this legacy, telecommunications regulators have often adopted the presumption that relevant markets are national in character, unless proven otherwise Although geographically-variegated regulatory remedies have been permitted (even in the face of allegedly national relevant markets) and adopted in many member states, many regulators have never done so, and overly cautious thresholds for permitting geographically based forbearance suggest a continued bias towards presuming national markets and remedies. We find that this presumption of uniformity and the tendency to aggregate geographic markets together is not supported by first principles of antitrust analysis, although there may have been strong practical reasons to apply this presumption in the past circumstances of the telecommunications and broadband industries.On the ground, however, there has arguably never been as much heterogeneity across geographies and across technological solutions that provide effective ultra-fast broadband speeds. Both technological (i.e., product market) and geographic heterogeneity are likely to increase with the advent of mobile 5G networks. With their deployment, a cautious regulatory stance towards geographic variation and a cautious regulatory stance towards inter-technology or inter-modal competition may result in regulation that could exceed what is required to ensure effective competition and could instead distort the incentives to enter of facilities-based actors. This may also result in higher-cost and inefficient investment. A more geographically varied and technologically agnostic regulatory framework may satisfy the principle of proportionate and focused regulation—with the possibility that the locus of regulation shifts from the access network to bottleneck facilities such as fibre, ducts and poles.This discussion is especially germane when one considers the highly speculative nature of forecasts and projections about future demand, and the competing claims of proponents of 5G and fibre. While there is some scepticism about the performance of mobile networks, we note that pure mobile and fixed 5G services may have synergies in deployment, and that the idea of competing with residential broadband services is a core strategy of very influential large-scale industry actors. In terms of a future research agenda, regulatory decisions could benefit from much more research into the relationship between domestic and global bandwidth constraints and their influence on development of software and application, as well as much more quantitative research by academics on the drivers of bandwidth demand. The risks associated with promoting investment that results in large-scale wasted resources should also be central to the regulatory agenda.     

Competition and regulation in China's 3G/4G mobile communications industry—Institutions,governance, and telecom SOEs

When it comes to the analysis of the intrinsic mechanism of market behaviors and hence competition development and regulatory imperatives in the Chinese telecommunications industry, currently there is no consistent pattern offered in the literature. In China's emergent 3G/4G era, market behaviors can be affected by various institutional factors, along with various forms of informal forces, which may translate into different implications for competition regulation. Based on extensive archival research and interview, this current study aims to bridge the gap by following an interpretive approach. An input–output model was substantiated for pattern-matching in the Chinese context base on the postulation of a series of propositions and hence Industry-Gray-Box. Accordingly, two categories of market behaviors, that is, market-driven vs. institutions-driven, were arguably delineated as being underpinning the competition development. Policy implications and future reform imperatives were discussed. This study may advance knowledge in terms of: (1) the establishment of a relatively consistent pattern for mapping the landscape of China's communications industry; (2) the substantiation of the inner working mechanism of China's SOE system in the telecommunications sector; and (3) original first attempt in identifying different roles of telecom SOEs and the governing forces that affect them. The paper also offers extensive and cohesive insights on China's formal and informal institutional environment in general and for telecommunications in particular. Measurements developed in this study may serve as basis for future study.     

Terrestrial digital broadcasting: convergence and its regulatory implications

This paper is a contribution to the development of analyses of the process of converging media and to the clarification of the regulatory implications of this process. It is generally agreed that the process of convergence between telecommunications, IT and broadcasting through its technological, organisational, and market/service aspects has far-reaching influence on the sectors involved and on future socio-economic settings. The paper explores the preparation for introduction of terrestrial digital television in Denmark as an aspect in the general process of convergence. The explorative analysis establishes an understanding of the technological issues and drivers in the development, which in interaction shape a digital distribution structure that is a concrete part of convergence. Based on this understanding, a model – the OSA-model – is suggested for the techno-economic structure of distribution of terrestrial digital TV. The model is used to discuss market prospects and regulatory implications, as these are derived from the interplay of traditional areas of regulation in the three sectors and areas emerging as candidates for regulatory activity based on their functionality. The discussion of the process of introduction of terrestrial digital TV in Denmark thus provides a general analysis of convergence and its regulatory implications.     

Information resources : A nation's stake in telecommunications

The major trend affecting worldwide economic development is the growing level of information-intensive activities throughout all sectors of increasingly global markets. This paper analyses the crucial role of telecommunications in a nation's productive processes. It examines the salient market force of services in virtually all sectors of national economies, describes how VANs enhance the quality and utility of basic communications channels, and analyses future network growth as a country's economy and society become increasingly computerized. The author discusses the importance of competition and recommends that restrictive regulatory regimes should respond to dynamic technological change.     

Concentration of the mobile telecommunications markets and countries’ competitiveness

This study examines how the level of concentration of a country’s mobile telecommunications market affects its competitiveness. We created a unique database with information on 59 countries, which we used to perform several estimations including an instrumental variable approach to explain the degree of concentration in mobile phone markets. Our first and direct estimation shows that the higher the concentration in this industry, the lower the countries’ competitiveness. In order to understand this positive correlation, we provide two additional estimations. First, using an instrumental variable, we find that the concentration in mobile telecommunications market explains the use of information and communications technology (ICT). Moreover, we also find that the use of ICT is positively correlated with countries’ competitiveness. Thus, our results confirm that the mobile phone industry has positive spillover effects on countries’ competitiveness and demonstrate the benefits of policies designed to reduce concentration and market power in the industry.     

There is power in a union? Union members' preferences and the conditional effect of labour unions on left parties in different welfare state programmes

This article studies the effect of labour unions on policy-making in six different parts of the welfare state (passive and active labour market policy, employment protection, old-age pensions, health care and education) in OECD countries after 1980 with a two-level strategy: At the micro-level, we investigate union members’ preferences. Ordered logit regression analyses indicate that union members favour generous social policies more strongly than non-members. Moreover, this effect is stronger for programmes closely related to the labour market than for programmes without a strong labour market link. At the macro-level, we investigate the conditional effect of unions on left parties expecting the former to push the left towards more generous labour market-related (but not towards less-labour market-related) programmes. Regression analyses essentially provide evidence for such a relationship. Overall, unions have been powerful in promoting their members’ social policy preferences via left parties in government but their power is recently vanishing.     

The public incumbent's defeat in mobile competition: Implications for the sequencing of telecommunications reform

Within a mere 5 years of market competition, the mobile communications sector in Taiwan has exceeded a 100% penetration rate, currently ranking near the top of the world. In an even more stunning development, the public incumbent, Chunghwa Telecom, has handed the leadership status to a market entrant, Taiwan Cellular Corp., despite phenomenal mobile communications growth. This paper explores the factors that hamstrung Chunghwa Telecom in competition against its rival entrants. Our econometric analysis substantiates the fact that handset subsidies are the most effective instrument for mobile firms to gain market share. Chunghwa Telecom, due to its public ownership status, was nevertheless prohibited at first from adopting such a marketing strategy.The empirical results provided in this paper indeed pinpoint the importance of the sequencing of reform mandates in developing telecommunications: a prolonged privatization could help to promote competition in the industry. Public ownership makes Chunghwa Telecom vulnerable to political intervention and operational inefficiency, which is a barricade to performance and competitiveness for the not-yet-privatized company in a liberalized market. Taiwan's case presents an interesting deviation from conventional development theories, while it deserves scrutiny as it paves a shortcut to successful implementation of telecommunication reform in a timely fashion.     

China’s telecommunications evolution,institutions, and policy issues on the eve of 5G: A two-decade retrospect and prospect

Over the past two decades, China’s telecommunications industry has witnessed drastic market reform, steadfast institutionalization, and volatile technological changes, which have driven exponential industry expansion. This paper offers an updated longitudinal and comprehensive review on this reform process on the eve of 5G (the fifth generation mobile communications networks). First, the paper segments the two-decade reform crusade into discernible phases, each of which is embedded with different policy drives. These reform phases are then pattern-matched against the subtleties of the overall institutional, technological, and market backdrop. A series of policy issues are identified through a systematic examination of industry phenomena over the reform course. Finally, the status of research is assessed regarding China’s telecom industry and reform, based on which, knowledge gaps are identified and future research agenda suggested. Conclusions are made regarding future reform and research imperatives. The paper advances the understanding of China’s telecom reform, development, and the underlying policy issues. It updates and expands previous works on similar topics. Overall, this study provides important theoretical, managerial, and policy implications.     

Conflicting national policies: The creation of the euro and the rebalancing of telecommunications prices

Government departments have diverse interests, and on certain occasions, the need to achieve a priority objective in one department may lead to the adoption of inefficient policies in other areas, with long-lasting consequences. In this paper, we analyze the rebalancing of the telecommunications tariffs that took place in the European Union before and after the liberalization of the market in 1998. We show that the objective of satisfying the Maastricht inflation condition to allow participation in the European Monetary Union from 1999 led some national governments to block the rebalancing of telecommunications tariffs. Specifically, we demonstrate that in the years immediately before the liberalization of the telecommunications market, those countries that faced greater difficulty achieving the inflation objectives of the Maastricht Treaty reduced, rather than increased, the prices of local telephone calls and line rental. Furthermore, these countries did not intensify efforts to rebalance their tariffs after the creation of the euro. Our paper also shows that in this period the countries that diverged most from the inflation condition invested less in their telecommunications infrastructure.     

Symbiotic production: The case of telecommunication pricing

In this paper we analyze a generalization of vertical monopolies in which monopoly suppliers trade essential inputs with one another. The most obvious applications of the model, which we call symbiotic production, are to postal and telecommunications services. We show how producers can use per-unit tariffs to achieve cooperative outcomes without colluding directly over consumer prices. We then show the firms have an incentive to collude in the setting of tariffs but that suchcollusion will lower consumer prices. This assumes that the suppliers are otherwise unfettered. In contrast, if the constituent monopolies are regulated, we show that collusion enables the firms to completely undo the restraints of regulation. The model has important policy implications for the international telecommunications market.     

International competition policy and telecommunications. Lessons from the EU and prospects for the WTO

The changes in the international telecommunications market are rapidly outgrowing the existing structure of regulation. Moreover the trends in the sector indicate that if the Most Favoured Nation (MFN) rule is to be viable some form of international competition policy is needed. This must tackle the difficult problems of market access, joint ventures and anticompetitive behaviour and most importantly prevent the different approaches to these problems leading to trade frictions, especially in the USA. Such rules have proved difficult, but not necessarily impossible, to develop as the stalled talks within the World Trade Organisation (WTO) have shown. The paper considers the possible relevance of developments within EU telecommunications regulation where a competition policy-led regime is emerging.     

Comparative research on regional regulators’ associations: A theory-driven path for progress

Since the 1990s regional economic communities have been increasingly involved in the development of model telecommunications policies and regulations. Through semi-independent regional regulators’ associations, these communities aim to harmonize telecommunications policy and regulation across member states in hopes of stimulating cross-border investments and market development. To fully understand the role and effects of these administrative bodies, analyses are needed within and between a variety of regions. The research described herein facilitates such analyses by providing a series of theoretically derived propositions developed with reference to a number of regions including the Organization of Eastern Caribbean States (OECS), the Southern African Development Community (SADC), and the European Union (EU).