The German Telecommunications Reform – Where did it come from, Where is it, and Where is it Going?

Abstract

German telecommunications reform came late because of high institutional constraints, powerful beneficiaries and reasonable functioning of the old system. It finally occurred because (1) the beneficiaries had less to lose, (2) Germany was falling behind, (3) reform was proven to work abroad and (4) the EC exerted pressure. The reform, particularly separation of posts from telecommunications, privatization of Deutsche Telekom and the creation of the RegTP, brought radical changes and the formation of new beneficiaries. The current sector crisis should spur research in the stability of competition in network industries and a reevaluation of the current reforms. Further reforms are required by new EC rules that will provide a more unified framework for the entire telecommunications sector. In the long run, privatization and liberalization will be completed, while some kinds of telecommunications-specific regulation will continue. Dominant firm regulation of end-user services is likely to be abolished down the road, while bottleneck regulation may persist. The remaining amount of dominant firm regulation and the pace of deregulation will depend heavily on market boundaries between (a) wireless and fixed networks, (b) high and low capacity subscriber access and (c) high-density and lowdensity networks. Assessing the interaction between market boundaries and market power requires economic research of intermodal competition and market power.

Regulierung und Deregulierung in Telekommunikationsmärkten: Theorie und Praxis

“…ermöglichte (vgl Monopolkommission, 1999 Witte, 1999;Monopolkommission, 1999, 2000, Vogelsang, 2003 (vgl. Vogelsang, 2003, Dewenter und Haucap, 2004a, 2004b Dixit, 1996).…”

Business value and risk in the presence of price controls: an option-based analysis of margin squeeze rules in the telecommunications industry

“…The unexpectedly progressive development since then, initialized by the privatization of the sector's monopolist Deutsche Telekom AG (DTAG) in 1995 as well as the introduction of the German Telecommunications Act (Telekommunikationsgesetz, TKG) in 1996 enabled Germany to catch up on an international level, as noticed by Vogelsang (2003). However, Cave and Prosperetti (2001) highlight that while service competition has reached levels comparable to the United States, few advances in infrastructure competition have been achieved at both, German and European level.…”

The Context of EU Telecommunications Reform Process: The Cases of Britain and Germany

“…Instead, this study builds on the framework of Thatcher (2000) and "altered states" offered by Cortell and Peterson (1999;2002). In the framework offered by Thatcher, the role of transnational forces is crucial as they overcome or modify the impacts of differences of national institutional environments in reform processes, therefore leading them to convergence of processes (2000,(6)(7)(8)(9).…”

“…Moreover, the predominantly small suppliers had to fight an unfair game in which their main competitor and regulator were closely related to each other. Again, although the market was opened for all services but telephony, the measure was incomplete as telephony made up 85% of telecommunications revenues at the time (Vogelsang 2002). The second stage, Postreform II, was approved in 1994.…”