[governance] The ITU/WCIT: Thinking About Internet Regulatory Policy From An LDC Perspective?

Fri Oct 12 22:06:39 EDT 2012

Thanks Milton, I have some limited knowledge of that literature. The problem
is, as per the abstract you quoted, in the real world the issue isn't just
with "the effects of privatization, competition, and regulation on
telecommunications performance (my emphasis)" where I have no doubt their
(and your) conclusions/assumptions would be borne out. Rather it is with the
somewhat more complex world of how to achieve non-telecommunications
benefits among those for example who are really very far away from the
closest exchange or cell tower and whether achieving the benefits that you
(and they) are pointing to, are, in the broad scope of requirements for
national policies for development (and in some cases even for survival)
worth the costs in terms of foregone revenues and means for a variety of
policy and other governmental intervention.

Honestly, I don't know the answer but  simply quoting studies of the
impacts/benefits of privatization without a parallel examination of the
broader socio-political and economic costs doesn't I'm afraid, take us very
far.

Best,

M

From: Milton L Mueller [mailto:mueller at syr.edu] 
Sent: Saturday, October 13, 2012 1:45 AM
To: michael gurstein; governance at lists.igcaucus.org
Subject: RE: [governance] The ITU/WCIT: Thinking About Internet Regulatory
Policy From An LDC Perspective?

Michael

There is a vast literature on telecommunications liberalization and
privatization's effects. If you have not seen evidence to back up the
arguments about the effects, it is not because it doesn't exist. Here are
some samples:

The Impact of Privatization and Competition in the Telecommunications Sector
Around the World 

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=364140

Telecommunications Liberalization on Two Sides of the Atlantic

http://muse.jhu.edu/books/9780815798781 

The institutional environment and effects of telecommunication privatization
and market liberalization in Asia 

http://www.sciencedirect.com/science/article/pii/S0308596100000665 

The productivity effects of the liberalization of Japanese telecommunication
policy http://www.springerlink.com/content/r48142651763j8hv/

I include the abstract from this article, which summarizes the consensus of
much of this research 

An Econometric Analysis of Telecom Competition, Privatization, and
Regulation in Africa and Latin America. 

The Journal of Industrial Economics. Volume 49, Issue 1, pages 1-19, March
2001

This paper explores the effects of privatization, competition, and
regulation on telecommunications performance in 30 African and Latin
American countries from 1984 through 1997. Fixed-effects regressions reveal
that competition is correlated with increases in the per capita number of
mainlines, payphones, and connection capacity, and with decreases in the
price of local calls. Privatization combined with an independent regulator
is positively correlated with telecom performance measures. Privatization
alone, however, is associated with few benefits, and is negatively
correlated with connection capacity.

[MG>] I know that is your position Milton, which at that level of
ideological pandering/name calling is no different from Kende's argument and
we hear it often enough.  What I would very much like to see though, is some
evidence to back it up. What I'm curious to see, and that was the point of
my original note, is some research/analysis which starts not from a
definition of "benefits" as dictated by Google, Microsoft, and Uncle Tom
digerati and all but rather one which starts from the quite specific policy
contexts and dilemmas of the folks in LDC's who seem to be bearing a rather
large amount of short term cost in the service of purported long term
benefit (and not incidentally alongside rather significant short term
benefits adhering to already extremely well provided for DC beneficiaries).
And if they don't publicly object I will,  not all of those folks or dare I
say even most (countering again some ideological and even should  I say
xenophobic posturing rather than systematic analysis and research on your
part) are as you imply, corrupt and despotic. 

I myself am of two minds on this issue.  I well recognize the value/benefits
that could flow from Internet access even to the poorest of the poor and the
overwhelming benefits that Internet access provides to those for example in
civil society who can take advantage of its more or less unlimited free flow
of communications and information (including through undermining various
repressive political regimes). On the other hand, the unlimited unregulated
policy environment advocated by reports like that of Kende and others of
that ideological ilk would I think, lead almost directly to a further
enrichment of the already stupendously wealthy and overall a signifcant
transfer of wealth and benefit from those with the least to those with the
most.

[Milton L Mueller] I am glad you are honest about this two-mindedness.
Factually, there is just no way around it. The liberalization and
deregulation of telecommunications has massively increased access, decreased
costs, increased diversity and innovation. 

[MG>] For some certainly, but I'm wondering who have been the net
beneficiaries and whether those who haven't benefited directly have in fact
borne some of the cost of those benefits. I don't know, maybe they have,
maybe they haven't but neither Kende or you have offered much beyond
ideology and bluster in that regard.

The internet never would have happened without it. I know it provides
cognitive dissonance for some people, but all you have to do is compare the
penetration and price of ICTs before and after liberalization and the
contrast will be very, very stark. True, there have been pitfalls here and
there, usually due to remnants of monopoly power or not handling the complex
transition from monopoly to competition properly, but on the whole the
progress has been revolutionary. 

[MG>] You are probably right but I would like a bit more evidence than your
assertion and I would also like some analysis of the costs involved and also
an analysis of how those costs (and benefits) have been and are being
distributed and then an analysis of what might be required to ensure that
there has been some benefits distributed beyond the usual cast of
characters.  I know that you and I have benefited but I'm rather less sure
about the folks living in Khayalitcha and even less for the cattle herders
in Burkina Faso and I mean now not in a never never land future. And as an
outcome I'ld like to see an analysis which isn't zero sum (regulation or no
regulation) as you seem to suggest is necessary. Rather the question shoud
be what sort of regime (without regulation and or with what type of
regulation of what elements of the overall Internet technical ecology).

Mike 

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