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- 1. HOW TO MANAGEA TELECOMS BUSINESS THANKS TO (OR DESPITE) REGULATIONS EU REGULATIONS & COMPETITION LAW IN TELECOMS
- 2. EU REGULATIONS &COMPETITION LAW IN TELECOMS Session 5 Session 1 INTRO: REGULATORY OBJ & PRINCIPLES Session 2 Session 3 Session 4 MARKET PLAYERS & REGULATORS REG & COMPETITION POLICIES REGULATORY MANAGEMENT CONCL: CHALLENGES AHEAD PROGRAM
- 3. EU REGULATIONS &COMPETITION LAW IN TELECOMS SESSION 1 REGULATORY OBJECTIVES & PRINCIPLES WHY REGULATE & WHAT EFFECTS ON THE MARKET & IMPACT ON OPERATORS
- 4. REGULATORY OBJECTIVES &PRINCIPLES WHY REGULATE
- 5. REGULATORY OBJECTIVES &PRINCIPLES ...the rules of the game ! But does any game need such rules/intervention?
- 6. REGULATORY OBJECTIVES &PRINCIPLES a policy instrument in a specific area of the economy: utilities traditionally, intervention in all dimensions of business activity: State-controlled enterprises, under monopoly
- 7. REGULATORY OBJECTIVES &PRINCIPLES WHY? To safeguard public interests But in market-based economies, these rules have to be consistent with free-market principles
- 8. REGULATORY OBJECTIVES &PRINCIPLES Specific objectives in telecoms protect public’s interests & consumers’ rights promote universal access to basic services prevent abuses of market power create favorable environment for investment optimize use of scarce resources ……” lower prices, more choice, more efficiency “
- 9. REGULATORY OBJECTIVES &PRINCIPLES National monopolies International competition HOW? privatization liberalization competition harmonization
- 10. REGULATORY OBJECTIVES &PRINCIPLES WITH
- 11. REGULATORY OBJECTIVES &PRINCIPLES relaxing previous rules introducing new rules empowering new institutions
- 12. REGULATORY OBJECTIVES &PRINCIPLES REGULATIONS WHO: a Reg Authority WHAT: standards licensing scarce resources (F, N) access (interconnection) universal service quality security prices... COMPETITION LAW WHO: a Comp Authority WHAT: anti-competitive behavior abuse dominant position denial of access/ supply cross-subsidization predatory pricing tying/bundling restrictive agreements mergers & JV
- 13. ESTABLISHMENT OF SEPARATEREGULATORS REGULATORY OBJECTIVES & PRINCIPLES 1990 1992 1994 1996 1999 2000 12 22 30 53 84 96
- 14. Sector Regulator Competition Authority 30 23 2727 0 1 3 1 Issuing License Intercon- nection Pricing Service Quality Merger 10 21 OECD 1999, Number of Countries in each Category
- 15. REGULATORY OBJECTIVES &PRINCIPLES EFFECTS ON THE MARKET & IMPACT ON OPERATORS . WHAT RESULTS?
- 16. REGULATORY OBJECTIVES &PRINCIPLES EFFECTS ON THE MARKET & IMPACT ON OPERATORS Indisputable facts more (private) service providers development & modernization of networks new services on innovative technologies lower prices better quality increased penetration globalization
- 17. REGULATORY OBJECTIVES &PRINCIPLES EFFECTS ON THE MARKET & IMPACT ON OPERATORS THE RESULT OF REGULATION? degree of State control degree of liberalization market structure degree of international opening
- 18. State Ownership andPrivatisation Austr 100 199667 F 100 1997 100A 199847.8 El 50I199551100B 199833.7100 00Ca 1998 00US 19866566Jap 089D 199000 Fin 1984022UK1992 2002 100 1992 199853.3 Priv 1992 Priv2002 NZ 55.7 3.6
- 19. 82 16 UK1020 7611 Austra lia A 11 100 0 Fin 20 55 40 Spain0100 31 97 ? 3 OECD, 1998 Market Structure N of Licen % 1st % 2nd N of Licen % 1st % 2st Liberalization & Market Structure: V.Telephony
- 20. REGULATORY OBJECTIVES &PRINCIPLES IMPACT ON OPERATORS CASE STUDY 2G License a set of rights & obligations
- 21. REGULATORY OBJECTIVES &PRINCIPLES IMPACT ON OPERATORS CASE STUDY the costs of regulation
- 22. REGULATORY OBJECTIVES &PRINCIPLES EFFECT ON THE MARKET & IMPACT ON OPERATORS “winners” & “losers” but also damage from indecisive regulation
- 23. REGULATORY OBJECTIVES &PRINCIPLES EFFECT ON THE MARKET & IMPACT ON OPERATORS principles of “good” regulation: • professionalism WHO? • independence • efficiency HOW • objectivity • transparency WHEN? • participation
- 24. REGULATORY OBJECTIVES &PRINCIPLES EFFECT ON THE MARKET & IMPACT ON OPERATORS From Theory to Reality Objectives met? At what costs? Under-regulated or over-regulated?
- 25. REGULATORY OBJECTIVES &PRINCIPLES EFFECT ON THE MARKET & IMPACT ON OPERATORS still limited evidence long timing from legislation to market market distortions accountability criticized regulatory intervention exceeding initial target legacy of the past different paces & extent of reform across countries
- 26. REGULATORY OBJECTIVES &PRINCIPLES CONCLUSIONS However, liberalization, privatization & competition prove to be beneficial for efficiency and consumer welfare In the short run: more regulations
- 27. Regulatory Intensity Time Phase 1 : Monopoly Phase2: Monopoly & Competition Phase 3: Competition In the long run...
- 28. REGULATORY OBJECTIVES &PRINCIPLES CONCLUSIONS Competition better than monopoly Regulated competition better than monopoly Regulated competition better than un- regulated competition
- 29. REGULATORY OBJECTIVES &PRINCIPLES CONCLUSION