From denationalisation to wholesale broadband access: a retrospective of regulatory policies in the UK for the communications industry

Deshpande, Advait and Jones, Allan (2014). From denationalisation to wholesale broadband access: a retrospective of regulatory policies in the UK for the communications industry. Competition and Regulation in Network Industries, 15(3) pp. 232–257.

URL: http://www.crninet.com/pdf_file/ITS/CRNI_15_03_023...

Abstract

This paper examines the shifting regulatory policies in the United Kingdom (UK) across three market segments, telecommunications, radio/television and cable, starting with British Telecom’s (BT’s) denationalisation in 1984. For the period examined, this paper focuses on following key events:

–The phased liberalisation of the UK communications industry starting with the BT-Mercury Communications duopoly in 1984
–The allocation of cable franchises as regional monopolies in the mid-1980s
–Introduction of satellite broadcasting and the influence of British Sky Broadcasting (BSkyB) Corp. on broadcasting services in the 1990s
–The emergence of the Internet/Web and the subsequent development of a broadband policy from mid-1990s onwards

Drawing on Dodgson et al.’s concepts of Market logic, Coordination Logic, and Complex-Evolutionary Logic, the authors argue that the forms of regulation introduced shaped the ways the UK communications industry developed. Thus although the denationalisation grew out of a free market ideology, in practice the free market philosophy was tempered for a number of pragmatic reasons. Prominent among these was a need to create a competitive market in a context where competitors would be unlikely to emerge without regulatory intervention, and an emphasis on price competitiveness to ensure that the end-users benefitted from the best possible prices on available products and services. Subsequent events show that these interventions had unintended consequences. The unforeseen popular demand for Internet/Web access found regulators struggling to find ways to promote a competitive market, and incumbent operators struggling to find a way to offer a suitable product.

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