By Björn Wellenius, World Bank
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Extra info for Restructuring and managing the telecommunications sector, Volume 23
Telecommunication policyCon- gresses. Wellenius, Bjorn. International Bank for Reconstruction and Development. Series. 041 89-5773 ISBN 0-8213-1198-0 Page v FOREWORD As economic activity reaches a global scale and becomes critically dependent on vastly expanded flows of information, telecommunications is acquiring strategic importance for economic growth and development. At the same time, rapid innovation in telecommunications and information technology is lowering costs, creating new services and ways of delivering traditional services, and changing the cost structure of many other industries.
The inability of governments and telecommunications entities to react with adequate speed is causing real political difficulty. Dissatisfaction with telecommunications is becoming front page news in developing countries. Governments are beginning to feel that failure to deal with this discontent seriously threatens not only development in general but also at times even their own political survival. Page 11 Move toward Sector Reforms The governments of developing and newly industrialized countries are thus being forced to reevaluate telecommunications to seek ways of loosening the constraints that keep the sector from improving its performance.
Changed Cost Structures for All Other Industries. The relative cost of processing and transmitting information, as distinct from any other factor of production, has declined steeply. S. half of a private transatlantic voice channel. Today the cost is $4,0005,000. The new TAT-8 submarine cable will carry a similar price. The precipitous decline in the cost of information transmission and processing has stimulated its use in more and more areas. In merchandising, new systems integrate retail transactions at the cash register with purchasing and inventory management.