w on prices, establishing rules on interconnection between the oper- operator is given fair treatment by the established PTO, and that ators, and ensuring that uneconomic services continue to be pro- competition grows between the two. vided where they are in the public interest, these sometimes being New services and infrastructures, such as cellular or satellite funded publicly. Some countries also use these same regulatory communications, are often opened to competition at an early stage, procedures to protect their internal markets from external competi- frequently before the public PTT has been privatised. Sometimes tion. the PTT is barred from entering these new markets in order to Competition between equipment suppliers helps the service pro- prevent them dominating it. vider, whilst competition between service providers helps the equip- As illustrated in Figure 11.2 investment (usually foreign) fre- ment supplier. The establishment of standards also helps service quently flows into the new competing services and infrastructure providers since interoperability between equipment provides them which are set up. There are several reasons for this: with the option to source from many different suppliers. On the other hand the need to conform to standards is often a constraint on PTOs are sometimes prohibited by legislation from carrying the equipment suppliers, sometimes increasing the cost of their out certain activities in their own countries, and are eager to equipment. take the opportunity to expand overseas. This activity provides The key players 11/5 Government Regulatory Public PTT Competing Private valued added Competing Competing new services service providers and infrastructures Privatisation Liberalisation External investment Figure 11.2 The key players within the telecommunications market them with valuable experience, so that they can more readily It is generally recognised that monopolies do not result in effec- enter their own markets when legislations have been relaxed. tive services, and that p