The Digital Agency for International Development

Experimental Services

By Chris Wilson on 25 November 2009

Marco Zennaro of ICTP writes:

An interesting paper appeared in the November issue of IEEE Communications Magazine:

Economic Engineering for Improving Access to the Worldwide Telecommunications Network...

In regions where few people are able to pay market rates, there is little, if any, service without subsidies. However, when subsidies support telecommunications service, the funds are given to existing, typically monopoly, providers, and are often misused. This article defines a concept of how subsidy funds can be directed to consumers...

I applaud the concept of giving consumers more power. I also haven't read the paper as I don't subscribe to expensive journals.

However, I have to ask: what about the approach that is already widely tested and used in developed countries (and even India) of having a universal service obligation on telecomms license owners?

This seems to work well enough to have spread to virtually every developed country, and ensures efficient allocation of funds by the providers, as they have to compete with each other to offer universal service for the lowest price.

Why should an untested, experimental idea work better? And why should we try that experiment out on developing countries rather than on ourselves? Why would (or should) a developing country do as we say, and not as we do?