knowledge organiser: book 1, unit 1, 'anglo-saxon england' 1, Slides of English Language

Download knowledge organiser: book 1, unit 1, 'anglo-saxon england' 1 and more Slides English Language in PDF only on Docsity! 1 NIGERIA’S RESPONSE TO THE DYNAMIC TELECOMMUNICATIONS ENVIRONMENT: A POLICY-BASED STUDY DR. GODWIN CHUKWUDUM NWAOBI DEPARTMENT OF ECONOMICS UNIVERSITY OF ABUJA ABUJA, NIGERIA AND QUANTITATIVE ECONOMIC RESEARCH BUREAU P.O.BOX 240 GWAGWALADA, ABUJA NIGERIA, WEST AFRICA gcnwaobi@yahoo.com http://myprofile.cos.com/gcnwaobi +234-9-8820054 2 ABSTRACT IT SEEMS APPROPRIATE TO ASK WHAT IS SPECIAL ABOUT INFORMATION AND INFORMATION TECHNOLOGY BEFORE ONE SETS OUT TO ANSWER THE QUESTION OF HOW INVESTMENTS IN INFORMATION INFRASTRUCTURE SHOULD BE VALUED AND REGULATED. THIS PROJECT THEREFORE DISCUSSES THE THEORETICAL AND PRACTICAL CONCEPTS UNDERLYING RECENT DEVELOPMENTS IN THE REGULATION OF TELECOMMUNICATIONS IN NIGERIA WITH RESPECT TO EFFICIENCY AND WELFARE. IT FOCUSES ON ANALYSING STANDARDIZATION PROBLEMS, PRICING RULES AND ENTRY CONDITION RELATED TO NETWORKS AND NETWORK EFFECTS AND DERIVES PRELIMINARY POLICY RECOMMENDATIONS FOR THE NIGERIAN TELECOMMUNICATIONS INDUSTRY. IN THIS WAY, THE PROJECT PLANS TO CONTRIBUTE TO A LEGITIMATE AND SUSTAINABLE POLICY ENVIRONMENT THAT MAXIMISES THE PUBLIC BENEFITS OF INFORMATION AND COMMUNICATION TECHNOLOGIES THROUGH AN EMERGING NATIONAL INFORMATION INFRASTRUCTURE FRAMEWORK. 5 separate ‘store pipes’, to an IP world in which an ever increasing variety of combinations of technologies, applications and providers is possible (as shown in figure I.I) Figure I.I Convergent Communications Technologies, Providers and Applications Technologies Providers Applications Cable 3G MDS Satellite ISDN ADSL Broadcaster ISPs Datacasters Telcos Media Play TV Telephony Play TV E-mail WWW FTA Mobile 6 In this new environment, the regulatory and policy tools from the telephony world are in many cases no longer adequate. The underlying challenge therefore, is to develop new policy and regulatory tools for the new environment. Telecommunications in Nigeria was established in 1886 by the colonial administration, to promote (mainly) administrative functions and the socio-economic development of the country. Since independence, there have been a number of development plans for expansion and modernization of the telecommunication networks and services. Between 1960 and 1985, the management consisted of the department of posts and telecommunication (P&T) in change of the Internal network and the Nigerian External Telecommunications (NET) responsible for the external telecommunication services. Telecommunications development during this period was characterized by serious shortfalls between planned targets and their realization, principally because of poor management, lack of accountability and transparency and low-level indigenous technical know-how. However, in 1985, the posts and telecommunication department was split into the postal and 7 Telecommunications Divisions. The latter was merged with the NET to form Nigerian Telecommunications Limited (NITEL). The main objective of NITEL was to harmonize the planning and co- ordination of the Internal and external telecommunications services, rationalize investments in telecommunications development and provide easy-access, efficient and affordable services. However, they were numerous shortcomings and it was in other to tackle these shortcomings that the industry was deregulated. Moreover, the industry was deregulated by the establishment of the Nigerian communications Commission (NCC) by decree 75 of 1992 whose main objectives include: creating a regulatory environment for the supply of telecommunication services and facilities, facilitating entry of private entrepreneurs into the market; and promoting fair competition and efficient market conduct among all players in the industry. Other types of telecommunication service operators may provide service within Nigeria, subject to NCC rules and regulations on licensing (if any), service and technical standards, interconnection, and reporting obligations. These operators may include providers of non-basic, value added, and specialized services, such as paging, private voice, and data networks, public 10 foresight and good polices have deprived the economy of the maximum benefits it could have derived from the introduction of new telecommunications technologies. The sector therefore needs to be analyzed, with new policies, programs and projects designed to position it to take advantage of the opportunities provided by new technologies. 2.0 OBJECTIVES OF STUDY The revolution in communications and computing technology is producing a massive surge in the development of electronic information, education and financial services. While these services continue to sweep through developed economies, inadequate telecommunication infrastructures have isolated most African countries from these developments. The situation is most severe in Nigeria (a federation of 36 states, a federal capital territory (FCT) and 774 local government areas) where the penetration of telephones is the lowest in the world and her economic growth is an 11 all-time low. However, Nigeria has the potential to leapfrog the development of fixed-network into new technologies such as 3G with its massive potential for communication and data transmission. It is therefore the broad objective of this project to map out the development path into the 3rd Generation technologies. Specifically, this project shall seek: (1) To address the issues created by the unprecedented changes occurring in Nigeria’s social, political, economic and legal systems as a result of expanding computing power, convergence, and the rise of a networked world. (2) To facilitate the public opinion in the consideration and resolution of domestic and international policies that needs to be addressed in this new communications environment. (3) And to develop the Nigerian’s National Information infrastructure Framework (NIIF) 12 3.0 METHODOLOGY Network fundamentalists would argue that we have seen the invention of computers and their adoption and diffusion while networking lagged behind for a longtime and has become effective only in recent years. Indeed, as long as network effects do not prevail, it does not seem likely that IT investments provide a competitive advantage to an individual firm even though they do not increase overall productivity. In fact, it would well be that the competitive advantage of one firm depreciates the capital of other firms at all excessive rate so that these firms cannot earn the amortization their previous investments and have to cut down future investments. In the end, the competitive edge triggers a retrace which, on the one hard, leads to over-investment in IT and, on the other, to a reduction of complementary investment in IT and, on other, to a reduction of complementary investment and overall output. In compatibilities in computer hardware and software, the lack of common standards and coordinating institutions and the fundamental problem of excess inertia and inefficient lock-ins, 15 supplier proposes, equal to the general inflation rate minus an ‘X- factor’ that may be identical to the percent increase in productively. More specifically, an average price increase of some bundle of the firm’s output must not exceed the increase in the retail price index (RPI) minus an exogenously fixed constant X which reflects the firm’s potential for price reduction, i.e. X should be high if productivity increases lead to a substantial reduction of costs. The idea is that this reduction should be passed from the firm to the customer. In conclusion, waver man and Sirel (1997) ask the question: should incumbent firms be required to unbundle their services as the American model and in a hope of encouraging entry by firms who will add value in some way and resell? Or should regulators follow the British model of not focusing on unbundling in the hope of encouraging facilities-based entry? This is a fundamental question and its answer by and large determines how the telecommunications industry, with its productivity impact on other information technology items, is organized and how the corresponding markets perform. Developing countries, which often 16 suffer from a negligible installed basis in telecommunications, have virtually no possibility to derive efficiency gains from a policy pattern, at least in the short run. If there is no mechanism to help them escape from this short-term perspective and if no change can be introduced to the regulatory policy, then they will remain in the inefficiency trap. Most case studies indicate that the British model seems more appropriate to trigger substantial investments in telecommunications. However, there is the danger of inefficient duplication of network facilities. The related over-investments, although implying a misallocation from the microeconomic perspective, could nevertheless be beneficial from a macro perspective, enhancing overall economic activities, providing employment for skilled labor and creating human capital. 4.0 EXPECTED OUTPUT AND DISSEMINATION PLAN The expected outputs will include dissemination outputs such as publications, papers and Nigeriatel conference. This project can, it is hoped, add value to the process of change, particularly by linking what is leered from research to the development outcomes. Essentially, our research output is expected to follow the following format. A. INTRODUCTION 17 B. NIGERIA: COUNTY BACKGROUND B.1 OVERVIEW B.2 HISTORY AND POLITICAL ENVIRONMENT B.3 DEMOGRAPHY B.4 ECONOMY B.5 HUMAN DEVELOPMENT, EDUCATION AND HEALTH C. SECTOR REFORM C.1 History of sector reform C.2 Public consultation on sector reform C.3 Telecommunication policy and legislation C.4 Telecommunications market players C.5 The Internet in Nigeria C.6 World Trade Organization commitments C.7 Broad casting in Nigeria C.8 Effects of sectoral reforms D Nigeria communication commission (NCC): Institutional and organization structure D.1 Legislation creating NCC D.2 Finance D.3 NCC Board D.4 STAFF E General Regulatory Powers E.1 Rulemaking and public consultations E.2 Arbitration and Dispute Resolution E.3 Enforcement and IMMUNITY F. Nigeria’s Network Characteristics G. LICENCING REGIMES G.1 The GSM licensing process G.2 Commercial Radio licensing G.3 International Data Gateway licensing G.4 ISP licensing G.5 Spectrum licensing 1 NIGERIA’S RESPONSE TO THE DYNAMIC TELECOMMUNICATIONS ENVIRONMENT: A POLICY-BASED STUDY DR. GODWIN CHUKWUDUM NWAOBI DEPARTMENT OF ECONOMICS UNIVERSITY OF ABUJA ABUJA, NIGERIA AND QUANTITATIVE ECONOMIC RESEARCH BUREAU P.O.BOX 240 GWAGWALADA, ABUJA NIGERIA, WEST AFRICA gcnwaobi@yahoo.com http://myprofile.cos.com/gcnwaobi +234-9-8820054 2 ABSTRACT IT SEEMS APPROPRIATE TO ASK WHAT IS SPECIAL ABOUT INFORMATION AND INFORMATION TECHNOLOGY BEFORE ONE SETS OUT TO ANSWER THE QUESTION OF HOW INVESTMENTS IN INFORMATION INFRASTRUCTURE SHOULD BE VALUED AND REGULATED. THIS PROJECT THEREFORE DISCUSSES THE THEORETICAL AND PRACTICAL CONCEPTS UNDERLYING RECENT DEVELOPMENTS IN THE REGULATION OF TELECOMMUNICATIONS IN NIGERIA WITH RESPECT TO EFFICIENCY AND WELFARE. IT FOCUSES ON ANALYSING STANDARDIZATION PROBLEMS, PRICING RULES AND ENTRY CONDITION RELATED TO NETWORKS AND NETWORK EFFECTS AND DERIVES PRELIMINARY POLICY RECOMMENDATIONS FOR THE NIGERIAN TELECOMMUNICATIONS INDUSTRY. IN THIS WAY, THE PROJECT PLANS TO CONTRIBUTE TO A LEGITIMATE AND SUSTAINABLE POLICY ENVIRONMENT THAT MAXIMISES THE PUBLIC BENEFITS OF INFORMATION AND COMMUNICATION TECHNOLOGIES THROUGH AN EMERGING NATIONAL INFORMATION INFRASTRUCTURE FRAMEWORK. 5 separate ‘store pipes’, to an IP world in which an ever increasing variety of combinations of technologies, applications and providers is possible (as shown in figure I.I) Figure I.I Convergent Communications Technologies, Providers and Applications Technologies Providers Applications Cable 3G MDS Satellite ISDN ADSL Broadcaster ISPs Datacasters Telcos Media Play TV Telephony Play TV E-mail WWW FTA Mobile 6 In this new environment, the regulatory and policy tools from the telephony world are in many cases no longer adequate. The underlying challenge therefore, is to develop new policy and regulatory tools for the new environment. Telecommunications in Nigeria was established in 1886 by the colonial administration, to promote (mainly) administrative functions and the socio-economic development of the country. Since independence, there have been a number of development plans for expansion and modernization of the telecommunication networks and services. Between 1960 and 1985, the management consisted of the department of posts and telecommunication (P&T) in change of the Internal network and the Nigerian External Telecommunications (NET) responsible for the external telecommunication services. Telecommunications development during this period was characterized by serious shortfalls between planned targets and their realization, principally because of poor management, lack of accountability and transparency and low-level indigenous technical know-how. However, in 1985, the posts and telecommunication department was split into the postal and 7 Telecommunications Divisions. The latter was merged with the NET to form Nigerian Telecommunications Limited (NITEL). The main objective of NITEL was to harmonize the planning and co- ordination of the Internal and external telecommunications services, rationalize investments in telecommunications development and provide easy-access, efficient and affordable services. However, they were numerous shortcomings and it was in other to tackle these shortcomings that the industry was deregulated. Moreover, the industry was deregulated by the establishment of the Nigerian communications Commission (NCC) by decree 75 of 1992 whose main objectives include: creating a regulatory environment for the supply of telecommunication services and facilities, facilitating entry of private entrepreneurs into the market; and promoting fair competition and efficient market conduct among all players in the industry. Other types of telecommunication service operators may provide service within Nigeria, subject to NCC rules and regulations on licensing (if any), service and technical standards, interconnection, and reporting obligations. These operators may include providers of non-basic, value added, and specialized services, such as paging, private voice, and data networks, public 10 foresight and good polices have deprived the economy of the maximum benefits it could have derived from the introduction of new telecommunications technologies. The sector therefore needs to be analyzed, with new policies, programs and projects designed to position it to take advantage of the opportunities provided by new technologies. 2.0 OBJECTIVES OF STUDY The revolution in communications and computing technology is producing a massive surge in the development of electronic information, education and financial services. While these services continue to sweep through developed economies, inadequate telecommunication infrastructures have isolated most African countries from these developments. The situation is most severe in Nigeria (a federation of 36 states, a federal capital territory (FCT) and 774 local government areas) where the penetration of telephones is the lowest in the world and her economic growth is an 11 all-time low. However, Nigeria has the potential to leapfrog the development of fixed-network into new technologies such as 3G with its massive potential for communication and data transmission. It is therefore the broad objective of this project to map out the development path into the 3rd Generation technologies. Specifically, this project shall seek: (1) To address the issues created by the unprecedented changes occurring in Nigeria’s social, political, economic and legal systems as a result of expanding computing power, convergence, and the rise of a networked world. (2) To facilitate the public opinion in the consideration and resolution of domestic and international policies that needs to be addressed in this new communications environment. (3) And to develop the Nigerian’s National Information infrastructure Framework (NIIF) 12 3.0 METHODOLOGY Network fundamentalists would argue that we have seen the invention of computers and their adoption and diffusion while networking lagged behind for a longtime and has become effective only in recent years. Indeed, as long as network effects do not prevail, it does not seem likely that IT investments provide a competitive advantage to an individual firm even though they do not increase overall productivity. In fact, it would well be that the competitive advantage of one firm depreciates the capital of other firms at all excessive rate so that these firms cannot earn the amortization their previous investments and have to cut down future investments. In the end, the competitive edge triggers a retrace which, on the one hard, leads to over-investment in IT and, on the other, to a reduction of complementary investment in IT and, on other, to a reduction of complementary investment and overall output. In compatibilities in computer hardware and software, the lack of common standards and coordinating institutions and the fundamental problem of excess inertia and inefficient lock-ins, 15 supplier proposes, equal to the general inflation rate minus an ‘X- factor’ that may be identical to the percent increase in productively. More specifically, an average price increase of some bundle of the firm’s output must not exceed the increase in the retail price index (RPI) minus an exogenously fixed constant X which reflects the firm’s potential for price reduction, i.e. X should be high if productivity increases lead to a substantial reduction of costs. The idea is that this reduction should be passed from the firm to the customer. In conclusion, waver man and Sirel (1997) ask the question: should incumbent firms be required to unbundle their services as the American model and in a hope of encouraging entry by firms who will add value in some way and resell? Or should regulators follow the British model of not focusing on unbundling in the hope of encouraging facilities-based entry? This is a fundamental question and its answer by and large determines how the telecommunications industry, with its productivity impact on other information technology items, is organized and how the corresponding markets perform. Developing countries, which often 16 suffer from a negligible installed basis in telecommunications, have virtually no possibility to derive efficiency gains from a policy pattern, at least in the short run. If there is no mechanism to help them escape from this short-term perspective and if no change can be introduced to the regulatory policy, then they will remain in the inefficiency trap. Most case studies indicate that the British model seems more appropriate to trigger substantial investments in telecommunications. However, there is the danger of inefficient duplication of network facilities. The related over-investments, although implying a misallocation from the microeconomic perspective, could nevertheless be beneficial from a macro perspective, enhancing overall economic activities, providing employment for skilled labor and creating human capital. 4.0 EXPECTED OUTPUT AND DISSEMINATION PLAN The expected outputs will include dissemination outputs such as publications, papers and Nigeriatel conference. This project can, it is hoped, add value to the process of change, particularly by linking what is leered from research to the development outcomes. Essentially, our research output is expected to follow the following format. A. INTRODUCTION 17 B. NIGERIA: COUNTY BACKGROUND B.1 OVERVIEW B.2 HISTORY AND POLITICAL ENVIRONMENT B.3 DEMOGRAPHY B.4 ECONOMY B.5 HUMAN DEVELOPMENT, EDUCATION AND HEALTH C. SECTOR REFORM C.1 History of sector reform C.2 Public consultation on sector reform C.3 Telecommunication policy and legislation C.4 Telecommunications market players C.5 The Internet in Nigeria C.6 World Trade Organization commitments C.7 Broad casting in Nigeria C.8 Effects of sectoral reforms D Nigeria communication commission (NCC): Institutional and organization structure D.1 Legislation creating NCC D.2 Finance D.3 NCC Board D.4 STAFF E General Regulatory Powers E.1 Rulemaking and public consultations E.2 Arbitration and Dispute Resolution E.3 Enforcement and IMMUNITY F. Nigeria’s Network Characteristics G. LICENCING REGIMES G.1 The GSM licensing process G.2 Commercial Radio licensing G.3 International Data Gateway licensing G.4 ISP licensing G.5 Spectrum licensing 20 Faulhaber, G.R. (1975) ‘Cross-Subsidization: Pricing in Public enterprises, American Economic Review, 65:966-77 Gabel, D. (194) “Competition in the network industry: the telephone industry, 1894- 1910, Journal of Economic History, 54:54-72 Holler, M.J. (1999) “On the Regulation of Telecommunications Markets”, UNU/WIDER Working paper 163 Liebowitz, S.J and S.E. Margolis (1994) “Network externality: An Uncommon tragedy,” Joumal of Economic Perspectives, 8: 133-50 Little child, S.C. (1983) Regulation of British Telecommunications Profitability, London: HMSD. Maynard, S.J. (1982) Evolution and the theory of Games Cambridge: Cambridge university press Mixon, F.G. and Y. Hosing (1997) “The determinants of market share for the ‘dominant firm’ in telecommunications,” Information Economics and Policy, 9: 309-18 NCC (1994) Perspectives on the deregulation of Telecommunications in Nigeria, Lagos: Nigeria Telecommunication commission Nwaobi, G.C. (1998) Computing Technology and Behavioral Research: An integrated Approval Quanterb/NYAKODPRESS Nwaobi, G.C. (1999)” Information Technology in Africa: Structure and Diffusion, proceedings of the IEA XII WORLD CONGRESS, BUENOS AIRES, ARGENTINA, SOUTH AMERICA http://www.aaep.org.ar/12 world congress/congress/papers/abstracts/nwaobi.html Naomi, G.C. (2000) The knowledge Economics: Trends and Perspectives, Lagos: Quanterb/Goan Communication Press. Tye, W .B. (1993) ‘Pricing market access for regulated forms’, logistics and Transportation Review, 29:39-67 Varian, H.R. (1984) Microeconomic Analysis, London: Norton Waver man, Land E. Sirel (1997) “European Telecommunications Markets on verge of full liberalization”, Journal of Economic Perspectives, 11:113-126 21