The Diffusion of National ICT Planning and Policies in Latin America - PowerPoint PPT Presentation

The Diffusion of National ICT Planning and Policies in Latin America Dr. Raúl L. Katz Adjunct Professor, Division of Finance and Economics Director, Business Strategy Research Columbia Institute of Tele-information III Conference ACORN-Redecom Mexico, D.F. September 5, 2009

The ICT policy and planning experience in Latin America has undergone three phases PHASES DRIVERS PRIMARY ACTORS Reduce the size of government Limited regulatory technical experience, ● ● required outside multilateral (ITU, World Bank) Increase ICT sector efficiency ● PRIVATIZATION AND or private advisory (i-banks, consulting and law Generate funds for public treasuries ● LIBERALIZATION (1990- firms) Generate static and dynamic ● 2002) efficiencies Signal foreign capital that Latam was ● an attractive market Transition to “information societies” Multiple state agencies ● ● (development of broadband, adoption In some cases, private sector involvement ● DEVELOPMENT OF ICT of computers, ICT-literacy) In some cases, subject to Executive or ● PLANS (1999-Current) Promotion of export-led growth sectors Parliamentary approval ● (e.g. software industries) Development of E-government Municipalities and State governments ● ● agendas (ciudades digitales) EMERGENCE OF SUB- Promotion of ICT clusters and regional ● SOVEREIGN PLANNING economic development (2003-Current) In some cases, driven by lack of ● planning capacity of federal governments or in opposition to national agendas 2

Each phase has been progressing across processes that can be studied with the help of diffusion theories ● Is there a pattern in the way telecommunications policies are adopted by different countries in Latin America? Timing? Imitation? Leaders and followers? ● What are the influencing factors driving policy adoption? ● Does the diffusion of planning initiatives across the region follow a pattern similar to that of privatization and competition? ● What can we learn from the first phase of privatization and competition that is relevant to the planning phase? 3

Agenda ● Public policy diffusion among Latin American countries ● ICT planning experience in the region ● Prescriptive planning models 4

Phase 1 (Privatization and Liberalization) adoption followed a conventional diffusion process DIFFUSION OF REGULATORY INITIATIVES IN LATIN AMERICA 25 Despite the (re) 20 nationalization of CANTV (Venezuela) 15 and Entel (Bolivia), and the reluctance of Uruguay and 10 Ecuador to privatize their incumbent 5 0 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 Privatization of incumbent Independent Regulator Source: Katz (2009) 5

Three variables help understand the privatization and liberalization policy diffusion process VARIABLES TYPOLOGY ● Geographic proximity (similar problems and conditions, “copy your neighbor”) DIFFUSION PATTERN ● Lateral diffusion (among countries sharing common socio-economic and cultural circumstances) ● Hierarchical diffusion (from advanced countries to developing ones) ● Instigators (leaders and radicals) ROLE OF COUNTRIES ● Followers (moderates and indecisive) ● Laggards (conservatives, “snobs”) ● Supra-national (ITU, World Bank) ROLE OF INSTITUTIONS ● Policy entrepreneurs (consulting and law firms, academics, i-banks) ● Community networks (ERG, Regulatel, etc.) 6

The institutional role in the diffusion process has followed several models INSTITUTIONAL ROLES IN THE TRANSFER OF PUBLIC POLICIES LLU in Europe COMPULSORY TRANSFER (transfer as a result of an agreement) COHERCIVE VOLUNTARY TRANSFER TRANSFER (direct imposition) (transfer by learning) VOLUNTARY BUT DRIVEN CONDITIONALITY RATIONAL DECISION MAKING BY AN EXTERNALITY (promote DFI) Pressure from IMF for Influence in conducting privatizing fixed line Structural Separation Auction of Band B incumbents or liberalizing spectrum in Brazil (1994) telecom industry (e.g. Korea) 7

Right now, the region is embarking in a process of consideration of incumbent’s functional separation models 1984-1989 1990-2000 2001-2005 2006-2008 US Telecom Act allows re- Consent Decree results integration of Local in Local LD separation and LD (1996) of ATT (1984) Functional Separation EU Directive obliges Functional UE agrees on a system of BT (2005) Separation telcos to divest from Separation of EUROPE to control industry is approbed cable TV operations Swisscom (2002) y DT TeliaSonera (2008) concentration (1989) (2004) divest their cable at a remedy (1995) Eircom considers operations by EC structural separation Rule 1/2003 defines Functional structural remedies to separation of face abuse of market Telecom Italia position ASIA Functional separation of TNZ (2008) Anatel Commissioner LATAM raises the benefits of functional separation in Brasil Discussion begins in Colombia 8

Through diffusion processes, policy convergence is emerging within the region although some differences exist with other continents Europe Latam Asia North America Convergencia de un modelo de No hay un modelo de Convergencia de un modelo de No desagregación tanto en ● ● ● ● Unbundling desagregación para todos los desagregación o reventa en la desagregación para Corea, Malasia, Canadá o USA estados de la UE región Taiwán y Singapur Dividendo digital, asignación de 2.6 Siguen políticas y principios de En la mayoría de países se otorga en Dividendo digital, asignación de Spectrum ● ● ● ● GHz la ITU WARC conjunto con la licencia, excepto en 2.6 GHz management PRC Reformulación de 2G Distribución de acuerdo al ● ● Algunos países se distribuye confiando mercado Diferentes términos legales, ● ● en el mercado procesos y condiciones La carga es repartida entre todos La carga es repartida entre La carga es repartida entre todos los La carga es repartida entre Universal ● ● ● ● los operadores según beneficios todos los operadores según operadores según beneficios todos los operadores según Service beneficios beneficios NGN regulation ● Desagregación del bucle del ● No desagregación Sin restricción para el acceso al ● abonado por mayor ● NGN - Ámbito sin definir Regulación de las NGN en proceso No desagregación ● ● de definición Foreign Restringido a participación Generalmente restringida a Sin restricciones ● ● ● ownership minoritario en México y Brasil participaciones minoritarias en Corea, restrictions Las Filipinas, China, Malasia, Taiwán y Sin restricciones en Chile, ● Tailandia Argentina En general , VoIP no está regulado ● Con la excepción de Chile, Variedad de modelos basados en la En general , VoIP no está VoIP • ● • VoIP no está regulado incertidumbre del impacto regulado Control para operadores con poder Variedad de modelos, desde estrictos No hay price cap ● ● ● Tariff controls significativo de mercado (SMP) (PRC), price cap (Corea) , basados en índices de productividad (Australia and Taiwán) hasta control para SMP (Singapur) Convergencia within one region Convergencia across regions 9

There is a need to start breaking with the imitation cycle and assume policies that reflect the region’s realities ● Build a solid understanding of economic and social needs of our regions ● Leverage the expertise that has been built in the region within the last fifteen years (academia, regulatory, policy makers) ● Assess foreign experience in light of the regional requirements (which means shying away from mechanical benchmarks) 10

Agenda ● Public policy diffusion among Latin American countries ● ICT planning experience in the region ● Prescriptive planning models 11

The second policy phase – Development of ICT Plans – comprises two parallel processes DIFFUSION OF PLANNING INITIATIVES IN LATIN AMERICA 12 • Framing document: 10 diagnostic of ICT situation Numero de Paises in country, general 8 objectives for sector development 6 • ICT Development Plan: specific sector plans with 4 focus on education, 2 industry development, economic impact, etc. 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Framing Document ICT Development Plan Source: Katz (2009) 12

The state of ICT planning varies substantially by country Country State of ICT Responsibility for Preparation Responsibility for Follow-up Private Sector Planning participation First Second First Second Third First Second Third Phase Phase Level (1) Level (2) Level (3) Level (4) level (5) Level (6) Argentina 1 n.a. n.a. n.a. n.a. n.a. n.a. Bolivia 2 n.a. n.a. n.a. n.a. n.a. n.a. X Brazil 1 n.a. n.a. n.a. n.a. n.a. n.a. X Chile 1 1 X X X Costa Rica 2 X X Colombia 1 X X X Ecuador 2 X X El Salvador 2 X X Guatemala 2 X X México 1 X X X Nicaragua 2 n.a. n.a. n.a. n.a. n.a. n.a. Panamá 2 n.a. n.a. n.a. n.a. n.a. n.a. Perú 2 X X X Venezuela 1 2 X X Uruguay 2 X X X Notes: 1) Presidentiall or Ministerial Commission, 2) Vice-Ministry, 3) Departmental, 4) Interministerial Commission, 4) Source: Katz (2009) Technology Commission, 5) Department 13