Governance, Regulation and Network Development Strategic Planning Workshop LIRNEasia Colombo, Sri Lanka, September 2004

Characteristics of 21st Century Network Economies & Information Societies Driven by the services sectors Founded on info/communication networks – next generation Internet; e-economies Dependent on effective reforms in the telecom sector – information infrastructure Strengthening links among local, national, regional, international networks and markets

Criteria for Economic Growth Policy & Regulation: Catalyst for – or constraint upon – development? TechnologiesMarkets ApplicationsServices Regulations Policies

LIRNE.NET Mission To facilitate institutional reforms for new "network" economies, by building human capital - through research, training and dialogue - as the foundation for effective policy, regulation, governance and management. Activities External Training Initiatives (for Government, Industry and NGOs) Research Activities and Reports Expert Analysis & Commentary on Current Issues World Dialogue on Regulation for Network Economies

LIRNE.NET A Strategic Collaboration Center for Tele-Information (CTI), TU Denmark Economics of Infrastructures, TU Delft, NL LINK Centre, Wits University, South Africa London School of Economics, UK LIRNEasia, Sri Lanka

WDR Dialogue Theme Stimulating Investment in Network Development: Roles for Regulators Defining and Implementing Regulation to Facilitate Sector Investment in Network Development The Challenge – Creating regulation that: Reduces rather than increases investment risk Leads rather than lags technology and market developments Provides a catalyst for investment and growth in network e-economies

Regulatory Relations Affecting Sector Investment

WDR Dialogue Theme 2004–2005 Diversifying Investment in Network Development Why? Research and Dialogue identified increasing diversification of potential sources of network investment being stopped by institutional barriers that can be reduced or removed.

Traditional Investment Sources for Telecom Network Infrastructure The State – PTTs Private Capital Markets - to state or private monopolies Donor Agencies – Developing Cos. - to state monopolies

Telecom Reform: Liberalization Phase 1 Investment Sources for Telecom Network Infrastructure PTTs Corporatized/Privatized Monopoly Private Capital Markets – primarily mobile Donor Agencies – shift to private mobile Equipment Manufacturers – loans High License Fees – reduced investment Fixed Networks in Developing Cos – little investment High Policy/Regulatory Investment Risk

Telecom Reform : Phase II Potential Participation in Network Investment New Network Operators Multisector Infrastructure – electricity, water, etc. Regional/Local Governments Regional/Local Private Investment Co-operatives Public/private Partnerships VANS/ISPs, Retailers Depends heavily on policy/regulation turning barriers into opportunities

WDR Theme Diversifying Participation in Network Development Organisation of the Research Pro Poor/Pro Market – with IDRC Regional/Local Public Sector Initiatives Public/Private Partnerships