`ITU is bureaucratic, not against government monopoly in telecom’

With increasing private participation in the telecom sectorinternationally, the role of the regulator is becoming important and amatter of debate in various countries. Does the ITU plan to formulate anyminimum international standards of regulations?
The ITU, as I said, is an inter-governmental organisation which can onlyshare experiences with member countries and debate these issues atinternational fora. However, since our suggestions have no legal binding,our role is restricted to giving suggestions rather than imposing rules. Wehave been telling countries, especially developing countries which need alot of foreign investment to build their telecom infrastructure, to havestrong regulators and encourage fair competition in a stable policyframework in order to achieve high growth rates in telecom. But each countrywill have to have a regulatory framework based on its individual needs andthe ITU cannot dictate these.

India opened its doors to foreign investors almost five years ago, butthe Indian experience has been rather worrying as balancing betweengovernment monopolies and the private sector has not been very successful.How do you think government monopolies must adjust to competing with theprivate sector?
Government monopolies in telecom are not necessarily bad so long as growthof the telecom sector is the government’s top priority. The Japanese NTTexperience in this regard is a good example which through monopoly gave highgrowth of telecom penetration in Japan. Governments which open up thissector for private participation only on the grounds of lack of funds willfind it surprising that they can raise funds from the subscribers to meettheir objectives, which may sometimes be better than depending on privatecompanies to achieve these goals. So every country will have to work out itsown priorities depending on what the people of that country need, andsincerely work towards this.

While I say this, I must also point out that often when governments havemore than one priority, private participation in these sectors may not be abad idea as it has been seen around the world.

Developing countries are facing a major dilemma as internet telephony andother cheaper services are being made available by private companies whichreally discourages infrastructure building. How do you think this problemcan be addressed?
This phenomenon is perfectly normal and should not scare developing nations.New and cheaper technologies will always replace old ones and will forceefficiency to improve in these countries. It will also give people access tocheaper services to people of that country.

It is unrealistic for countries to disallow usage of internet telephony asit uses 100 per cent capacity of existing telecom networks. Countries shouldnot stunt growth of these services for fear that companies will not investin infrastructure building because as the demand grows for these services,infrastructure will still be needed to meet the demand for internettelephony if not telephone calls. So one way or another, telecominfrastructure will have to grow. There is no substitute for moderntechnology but at the same time infrastructure will also always have scopefor growth.

The ITU took up cudgels for the developing world when the AmericanFederal Communications Commission (FCC) had recommended substantial cuts inaccounting rates for international telephone calls. What is your presentstand on the issue? Will you allow the developing world to succumb to USpressures on the count?
The FCC accounting rates has the advantage of prescribing cost-basedtariffs. So the sooner countries move towards such a system, the better itwill be for them in promoting growth of such services. However, what was badabout the FCC ultimatum was that it took a unilateral decision on reductionof accounting rates and wanted countries to fall in line within a very shortperiod.

This would have been very difficult for some developing countries which iswhy we at the ITU opposed a unilateral move of this nature. We expect thematter to come up again at the Montreal session of the ITU where the issuewill be voted. While we are in agreement with the principle of cost-basedtariffs our appeal to the US would be that the FCC should follow a consensusapproach in this regard regarding the timing of implementing such tariffs.