Telecommunication Agreement Signals Open World Market

By New York Times News Service | St Louis Post-Dispatch (MO), February 16, 1997 | Go to article overview

Telecommunication Agreement Signals Open World Market


New York Times News Service, St Louis Post-Dispatch (MO)


More than 60 countries endorsed on Saturday an agreement that will open their telecommunication markets to all rivals.

The pact legally commits governments to unlocking the state telephone monopolies that still control over half the world's communications business.

The agreement was reached after weeks of negotiations. The United States did not get everything it wanted. U.S. negotiators failed to persuade Canada and Japan to give up rules against foreign companies' buying controlling stakes in their dominant telephone carriers. But the pact does augur steep price reductions in many parts of the $602 billion worldwide communications market. To a great extent, the agreement exports the regulatory principles that revolutionized the American long-distance market in the 1980s and are now being extended to unlock local telephone monopolies in the United States. Consumers are likely to feel the biggest impact in Asia, Latin America and Africa. Most governments there have done little or nothing to reform creaky state-controlled monopolies, which provide shabby service at home and charge wildly inflated prices for competing international telephone calls. But the deal also will force the United States and Europe to follow through on opening up every segment of their markets to rivals: local and long-distance telephones, international service and wireless communications. …

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