Realising social goals in connectivity and content
The challenge of convergenceRichard Collins
In both telecommunications and broadcasting, new market structures have emerged which change the context of and rationale for regulation. In both domains governments have lost control over market entry and, consequently, the old method of achieving regulatory goals (including social goals) by attaching conditions to licences no longer works reliably. So what? Some claim that this no longer matters and that competition will spontaneously achieve the goals which once could only be realised through regulation. But this view seems excessively optimistic for the following reasons:
|• The future is constrained by the past-competition will not develop spontaneously because part of the legacy of the past is a number of dominant firms-often created by an earlier regulatory regime which controlled entry.|
|• Relevant markets fail in interesting ways. Regulation/intervention is likely to be required, not only to mimic the outcomes of a well-functioning market (dealing with dominant firms is one aspect of that) but because the economic characteristics of media and communications differ sufficiently from those assumed in economic theory for there to be perverse outcomes if markets work (or are made to work) in conventional ways.|
|• People don't enter markets equally endowed; allowing markets to work spontaneously may result in unacceptable levels of inequality and social exclusion.|
|• Economic efficiency may produce socially unacceptable outcomes (e.g. the monopolisation or oligopolisation of supply of information through concentration of ownership and/or control).|
These objections do not mean that competition should be rejected either as a regulatory goal or as a conceptual template for the regulatory or public policy On the contrary (to restate what is already on the public record as my view): 'Competition and markets have a valuable role in securing the public interest in media and communications' (Collins and Murroni 1996:183). But whilst competition is necessary, both as a conceptual paradigm and as a policy goal, it is not sufficient.