1JRN 930 Fall 2003International Aspects of Media Law & PolicyPart ITelecom Sector Organization in Industrialized and Developing Countries(C) 2003 J. M. Bauer 3TV density (% of HH with TV set, 2001)0 20406080100AfricaAmericasAsiaEuropeOceaniaWorldSource: ITU, World Telecom Development Report, Geneva, 2002.2(C) 2003 J. M. Bauer 4Telephone density (per 100 HH, 2001)0 20406080100AfricaAmericasAsiaEuropeOceaniaWorldSource: ITU, World Telecom Development Report, Geneva, 2002.(C) 2003 J. M. Bauer 5Internet users (users per 100 POP, 2001)0 5 10 15 20 25 30AfricaAmericasAsiaEur opeOceaniaWorldSource: ITU (2002).(C) 2003 J. M. Bauer 6Sector organization Broadcasting.z Public (state-owned and run) broadcasting systems dominant until late 1980s.z Gradual commercialization and privatization. Voice, data, and Internet.z PTTs (Posts, Telephone, and Telegraph) as state-owned providers of telecom services.z Gradual liberalization beginning in 1980s. Cable TV often provided by PTTs (at least the network infrastructure).3(C) 2003 J. M. Bauer 7Major trends Privatization.z Full or partial sale of state-owned t e le c o m service providers.z Total sales volume from PTT privatization >$200 billion.z Large sales are British Telecom (BT), Nippon Telegraph & Telephone (NTT), Deutsche Telekom (DT), France Telecom (FT).z An example of broadcasting privatization is TF-1 (France).(C) 2003 J. M. Bauer 8Major trends ... Liberalization.z Opening of the monopoly to competitors.z Sequence of CPE -- > value-added services and wireless - - > basic services -- > infrastructure in most countries.z Regional liberalization process in the European Union (EU) and multi- lateral, more global, process within World Trade Organization (WTO).z Elimination of foreign ownership restrictions.(C) 2003 J. M. Bauer 9Major trends ... Globalization of major service providers.z More than 200 foreign investment projects by U.S. telephone companies since the 1980s.z Formation of global alliances. Global One (Sprint, FT, DT). Concert (BT, AT&T).z Emergence of global media empires (New Corporation, CNN, Bertelsmann, …). Future of national regulation?4Part IIInternational voice and data communications(C) 2003 J. M. Bauer 11International services Rapid growth in international voice and data traffic Until early 1990s joint provisioning by respective national monopoliesz Each participating organization operated and was paid for a half-circuitz National monopolies had the exclusive right to terminate and originate traffic Gradual bilateral and multilateral opening of national markets(C) 2003 J. M. Bauer 12International routing Joint provisioning. Classic paradigm of international service provision in which each carrier provides national service. Hubbed service. A third PTO provides hub service to several other PTOs. Transit service. Third party provides hub and transit services. End-to-end service. Third party provides full end-to-end s e rv i c e .5(C) 2003 J. M. Bauer 13Satellite communications Int’l service classificationz Fixed satellite services (FSS)z Broadcast satellite services (BSS)z Mobile satellite services (MSS) Classification by orbitz Geosynchronous orbits (22,300 miles)z Medium Earth Orbits (MEOs)z Low Earth Orbits (LEOs)z Highly Elliptical Orbits (HEOs)(C) 2003 J. M. Bauer 14Satellite industry Geosat service providersz International consortia (e.g., Intelsat, Inmarsat)z Regional organizations (e.g., Eutelsat, Panaftel) z National organizations (e.g., SITE, Molyna)z Private carriers (e.g., PanAmSat) MEOs (e.g., U.S. Navistar GPS System, Odyssey, ICO (went bankrupt)) LEOs (Globalstar, Iridium, Teledesic) Manufacturers (Loral, Hughes, Lockheed)(C) 2003 J. M. Bauer 15Satellite industry ... Satellite service providers needz National license(s) for the spectrum used (e.g., in U.S. administered by FCC)z Access to the desired orbit in compliance with international regulationsz Agreements with providers of the earth segment Offer wholesale (capacity, carrier services), retail services (voice, data, Internet, DTH)6(C) 2003 J. M. Bauer 16Submarine facilities Early cables privately owned and operated on a whole circuit basis Radio links and higher-capacity cables jointly owned and operated (by PTTs and private TOs, such as AT&T):z Based on the legal assumption that each “correspondent” owns a “half-circuit” (e.g., 1/2 distance between UK and US)z Third parties (e.g., record carries in the U.S.) granted “Indefeasible Rights of Use” (IRUs)(C) 2003 J. M. Bauer 17Submarine facilities ... Private consortia since 1980sz Analog cables assigned to users by circuitz Digital cables use Minimum assignable units of ownership (MAUO=64 kbps) or synchronous transport module-ones (S T M-1=155 Mbps) International network owners need:z Landing rights in participating countriesz Transit rights through third countriesz Licenses to provide international services(C) 2003 J. M. Bauer 18Examples of consortia Trans-Atlantic Telecommunications (TAT) cables (e.g., TAT-9, TAT-10) Trans-Pacific fiber optic cables (e.g., TPC-3) Southeast Asia-Middle East-Western Europe 2 (SAE-ME-WE-2) over 18,000 kilometers Fiber Optic Link Around the Globe (FLAG)7(C) 2003 J. M. Bauer 19Cost of submarine facilitiesSource: Frieden, 2001, p. 125 Investment cost per minute 00.511.522.531950 1960 1970 1980 1990 2000 2010(C) 2003 J. M. Bauer 20Global carriers Historical global carriersz Cable and Wireless (Commonwealth)z France Telecom (French colonies) Several carriers intended to build their own global networksz Global Crossing or Level 3 Communicationsz Strongly affected by telecom crisis and ensuing lackluster demand Joint ventures (e.g., Global One, Concert)(C) 2003 J. M. Bauer 21Bandwidth markets Facilitated by the abundance of international bandwidthz Allow trading of bandwidth in spot and futures transactionsz Bandwidth exchange acts as a brokerz Offers standardized contracts for buyers and sellersz Example Band- X (London and New York) Emergence of virtual network operators (VNOs)8Part IIMajor Institutionsand Players(C) 2003 J. M. Bauer 23Intergovernmental players United Nations Organizations.z International Telecommunication Union (ITU).z United Nations Educational, Scientific, and Cultural Organization (UNESCO).z World International Property Organization (WIPO, http://www.wipo.org).z United Nations Conference on Trade and Development (UNCTAD).