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TELEKOM shall keep its networks monopoly as long as it provides leased lines (fixed connections) on fair and competitive conditions and in line with quality and quantity requirements. The Federal Government shall supervise the development of competition. The state of development shall be examined every three years. If the market does not develop satisfactorily, the Federal Government shall permit the establishment of competing networks.
However the Witte Commission did recommend a series of other liberalizing measures, notably in the field of private networks and satellite data transmissions. Furthermore, a minority report of the Commission dissented with the recommendation preserving the basic network monopoly, arguing that Germany should follow the example of the United States, Japan and United Kingdom in authorizing competitive network construction.
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METHODOLOGY
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It is clear from the above arguments that the decision facing the Hong Kong Government - whether to grant the cable television network franchise to the telephone company or a competitive operator is a very complex
It involves fundamental issues in Government's communications policy: whether there should be competitive or monopolistic supply of telecommunications networks, whether the common carrier principle of separation of content from conduit in communications networks should apply to cable television services, and, in the longer run, whether narrowband (telephony) and broadband (entertainment) services should be carried on separate or integrated networks.
We wish in this study to bring quantitative analysis to bear on these issues as far as possible. By quantifying the benefits and costs associated with the alternative policy options, it should be possible to cast some light on the relative strengths of the different arguments presented by the competing parties.
We state at the outset that the methodology of this study is designed only to address technical and economic factors. The role of communications networks in modern societies is so pervasive that decisions concerning the design, ownership and pricing are not made on the basis of the such factors alone. Social considerations, such as the desirability of universal access, political concerns, such as the desirability of avoiding excessive concentration of ownership of communications media, and considerations of security in the face of military or other crises also arise. Nevertheless we believe that, particularly in a modern industrial economy such as that of Hong Kong, the most important role of the communications network is an economic one - providing businesses and homes with efficient means of accessing information and entertainment. The commissioning of a quantitative economic benefit/cost analysis of the second telecommunications network
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