Compared to developed countries, telecommunications infrastructure in developing countries have a number of features that create both challenges and opportunities:
- Developing countries may not have extensive telephone network coverage, particularly outside main population centres,
- Wireless and mobile operators often play a significant role, particularly in rural and remote areas. Typically, wireless demand in developing countries exceeds wireline demand, sometimes by significant amounts,
- Fibre-optic systems are often not widely rolled-out (or not all fibre is “lit” with the necessary electronics). Customers may have limited or no access to broadband services, particularly in rural areas,
- The technology in use, and network architecture, are often outdated.
These factors create a number of challenges. In particular, significant investment may be needed to achieve universal service goals, or to make broadband service widely available.
At the same time, developing countries that are designing interconnection regimes now have the opportunity to design better regulatory regimes. The fact that traditional wireline technologies are not deeply embedded in many developing countries enables regulators to implement interconnection policies that are more appropriate to wireless networks, VoIP, and other emerging technologies. For example:
- The prominence of per-minute rates is a product of wireline technology. Per-minute rates may be irrelevant, or even counterproductive, when applied to VoIP services,
- Policies seeking to “unbundle” network elements assume that the wireline incumbent enjoys a near monopoly position in the provision of critical telecommunications infrastructure. This assumption may not be valid in many developing countries.
The absence of a well-established interconnection regime may allow regulators in developing countries to bypass policies that are no longer appropriate, in favour of arrangements that are sustainable, minimize opportunities for arbitrage, and are more in line with emerging technologies.