ing margins per unit sold in volume production. Further continued revenue generation is based on manufacturing for renewal and upgrade for the tied market, the infrastructure of the national operator, while again reselling the same refreshed product globally, either to developing countries or where infrastructure equipment competition is possible. The traditional model is followed to a varying extent in most OECD countries, notably Germany, France, Japan, Sweden, Korea, Italy and China, with the exceptions being the United Kingdom and to a limited extent, the United States. An example of the extreme necessity of this dependence is the failure of the United Kingdom company, Marconi in October 2005, with its forced sale to Ericsson when it failed to win a GBP 10 billion contract for new infrastructure with BT, the nationally dominant fixed line operator. Effectively it was undercut on costs in a free market environment, by new suppliers from the NICs with a far lower cost base for R&D and more advanced technology (for end-to-end packet switching) such as Huawei and ZTE from China. INFRASTRUCTURE TO 2030: TELECOM, LAND TRANSPORT, WATER AND ELECTRICITY - ISBN 92-64-02398-4 © OECD 2006 2. TELECOMS INFRASTRUCTURE TO 2030 New operator models challenge the current business models The previous section highlighted the fall in infrastructure costs per subscriber (fixed and mobile) over the past decade and the likelihood of this continuing into the future. Far lower costs of infrastructure and faster rollout mean lower costs of entry and also less time needed to obtain payback on investments. Consequently competition will be far greater. But also we can expect many shakeouts, as the market becomes saturated and margins on offerings become leaner. The logical consequence may be global consolidation, down to a few very large bulk carriers by 2030. In these circumstances regulation will be necessary to ensure competition and protect against restrictive practices and collaborative agreements. The new infrastructure based on data