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Global Telephone Access Improves As Internet Gap Widens

ITU Reports Reflect New Telecommunication Environment

Istanbul, 15 March 2002 — The latter half of the 1990s saw the sharpest rise globally in the rate of telecommunication network growth since the 1950s, while investment in infrastructure exceeded $200 billion in 2000. However, while the gap between developed and developing countries in telephone lines is closing, a divide is opening up in the availability and quality of Internet access.

Regulators have a critical role to play in bridging the digital divide by creating a climate conducive to enhanced investment and diffusion of services. However, this can only be achieved if they are given the right tools and resources to become effective: a firm mandate and clear goals; sufficient human and financial resources; adequate enforcement powers; organizational flexibility and timely decision-making.

According to Yoshio Utsumi, Secretary-General of the International Telecommunication Union, "Governments and regulators have an on-going responsibility to ensure universal access to telecommunications. They must also strive to make the technology and the services reasonably priced."

Two landmark reports being launched by the ITU at its 3rd World Telecommunication Development Conference in Istanbul, Turkey — "World Telecommunication Development Report 2002: Reinventing Telecoms" and "Trends in Telecommunication Reform 2002: Effective Regulation" — pinpoint the key issues for telecommunication planners and best practice for regulators in the new telecommunication environment.

"The ITU is responding to the needs of the sector with two state-of-the-art reports," said Hamadoun Touré, director of the ITU’s Telecommunication Development Bureau (BDT). "In a new, more sober environment in telecommunication, these two reports point the way for planners to reinvent access to services and for regulators to reinforce themselves to face the challenges of the moment. Both these reports will become essential reading as the sector positions itself for an age of responsive governance and plentiful and ubiquitous supply."

The latest World Telecommunication Development Report (WTDR 2002) shows that access to the Internet is harder to measure. "The new digital divide is not just about the number of access lines, but also about the quality of the experience, as evidenced, for example, by the availability of IP connectivity," says Tim Kelly, head of ITU’s Strategy and Policy Unit and co-author. "The greater the bandwidth, the quicker the response time."

One notable development is that the world’s Least Developed Countries (LDCs), surpassed the important threshold of one telephone subscriber per 100 inhabitants in the year 2001 and now have the world’s fastest growing networks, due in large part to competition in mobile cellular markets. "Moving beyond traditional measures, such as the number of phone lines per 100 inhabitants, WTDR-02 proposes new targets depending on a nation’s level of economic development. This includes 50% household penetration for Internet access in developed nations and 90% coverage by mobile service in developing ones," says Michael Minges, head of ITU’s Data and Statistics Unit and co-author of WTDR 2002.

The report also demonstrates, through the use of country case studies, that the difference between fast and super-fast network growth is often the quality and timing of reform.

Regulators hold the key to facilitating investment flows into the sector and enabling the benefits of Information and Communication Technologies (ICTs) to be dispersed as widely as possible. From a mere 13 countries in 1990, now some 115 countries, or over 60 per cent of ITU’s Member States have created a regulatory body. However, simply declaring telecommunications "competitive" does not ensure that any new market entrants would, or could, actually begin competing. Government guidance and action has been found necessary in nearly every country to nurture competition and the need for regulatory expertise2 has become more, not less, acute.

"The effectiveness of the regulator is closely related to his or her credibility and independence," explains Doreen Bogdan, regulatory officer in ITU’s Sector Reform Unit and co-author of Trends 2000. "There is no blueprint or national precedent for how regulators could achieve effectiveness and independence. However, this report shows that there are remarkable similarities in the issues that all governments face when they attempt to establish effective regulatory regimes."

"Increasingly, governments are realizing the value of their national ICT assets is linked to the strength of their sector reform programmes," adds Susan Schorr, also an ITU regulatory officer and co-author of Trends 2002. The growth in the number of ICT service subscribers worldwide continues to swell, and for the most part, these services are provided in a competitive framework that requires effective regulators to ensure fair and transparent market rules."

Complementing the reports is a series of case studies.

  • For the regulatory report, the studies provide best practice guidelines on the organizational structure, levels of transparency, financing, functions and powers of regulatory bodies that may be used by regulators and policy makers around the globe to achieve their national ICT development goals. They are downloadable here
  • Case studies on the telecommunication and Internet sector analyze the relationship between the traditional telecom sector and the Internet. They are available for download here
  • In addition, the ITU will be releasing a brand new version of its flagship World Telecommunication Indicators database at the conference. The database is the premier source of ICT statistics in the world.

For additional background information please click here

For further information, please contact:

Telecommunication Data and Statistics Unit
Telecommunication Development Bureau
International Telecommunication Union
Phone: +41 22 730 6090
Fax: +41 22 730 6449
E-mail: indicators@itu.int

Susan Schorr
Regulatory Officer, Sector Reform Unit
Telecommunication Development Bureau
International Telecommunication Union
Phone: +41 22 730 5638
Fax: +41 22 730 6210
E-mail: susan.schorr@itu.int

Note 1:

The new telecommunication world is one that can be characterized as private, competitive, mobile and global:

  • By the beginning of 2002, more than half the countries in the world had fully or partly privatized their incumbent operators, and they accounted for 85% of the world market by revenue.
  • Competition is the de facto norm in international telephony services and the majority of countries allow mobile and Internet competition, leading to a boom in network growth.
  • The year 2002 will also be remembered as the one when mobiles surpassed fixed lines. Currently, 97 countries have more mobile users than fixed-lines and almost 1 in 6 people on the planet have mobiles.
  • Investment holdings in offshore telecom operators, regional and multilateral agreements and cross-border services such as mobile and calling cards have all contributed to the globalizing nature of contemporary telecommunication.

Note 2:

ITU’s Annual Regulatory Survey indicates that 75% of all regulators — including some of the oldest and most established regulators — lack sufficient staff resources.

 

HELP WANTED!

Source: ITU World Telecommunication Regulatory Database, 2001

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