5. Conclusions and recommendations

government policy makers and

in question, and it may ultimately be

regulators worldwide (even the FCC),

more efficient to transition directly

who do not have the capacity to keep

from a public monopoly to a multi 

up with the rapid technological change

player competitive environment, with

in order to fully enforce regulations.

small areas of exclusivity (perhaps

down to the Warada level) for rural

Furthermore, a large and powerful

locations.

regulatory apparatus is not as

necessary in a country like Ethiopia

In preparation for this, the

as it is in some developed countries,

Government might look to develop a

for the reason that less developed

transitionary strategy that does not

countries do not generally have huge

directly affect the monopoly in ETC's

public incumbent telecommunication

core business (voice provision and

operators that need to be transferred

wholesaling of the national backbone),

into a competitive environment.

as well as laying the groundwork for

Rather, new operators entering a

the next phase of competition. An

competitive environment without a

immediate transitionary step would be

massive incumbent, should normally

to amend the telecommunication law

be able to self regulate to a much

to allow for resale of ETC's services.

greater extent.

Examples are needed to show that

liberalization could have beneficial

Another major difference between

effects on the market, and to bring

developed, and developing, country

improvements to the customers and

monopolies is that developing

to ETC. The licensing of new mobile

countries are not encumbered with old

operators, ISPs, cybercafes and call

technologies which are already being

centres would all help provide this

used by the  majority of the

impetus and take the burden off ETC

population. Instead, new companies

in providing the wide range of value 

can make use of next generation

added services that are needed.

technologies which are usually

cheaper, allowing much smaller

This will also help ETC to begin shifting

companies to enter the marketplace.

its operational culture into a

Today, even partial self provisioning

competitive mode, bring additional

can occur   as demonstrated by the

traffic to ETC, and more generally help

rapid growth of the Internet, WiFi and

to `decentralize' telecommunication

mobile telephony, this is now

services, separating wholesale from

becoming a model that can be used

retail operations, and leaving part of

more widely in the telecom sector.

the marketing and customer care

activities to private companies

In practical terms, while competition

operating in different zones and

in the telecom sector may indeed

regions. The expected results of this

result in some overlap and duplication

in demonstrating that competitive

of resources by the different

forces will ensure cost based pricing

competitors, the overall operation of

and higher service levels without the

the sector is more efficient than a

need for strong regulation would also

single monopoly.

help to address any concerns that an

open market will fail to deliver quality

Thus, any initial privatization and

and affordable services.

liberalization of the telecom sector in

this day and age should not simply be

One of the major difficulties

to shift a public monopoly to a private

experienced by the regulatory

one, which can become even more

authority, ETA, is its lack of financial

difficult to control, especially if it has

autonomy, increasing its dependency

a large foreign partner to back it up.

on government for decision making,

The record of foreign participation in

and low salary levels, making it

Africa has generally shown that even

difficult to attract and retain skilled

the strategy of a limited exclusivity

staff. By giving the opportunity to

period (usually 5 years) for basic

many small private companies to

services in urban areas is nowadays

apply for licences to resell services,

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