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An industry develops

An industry develops

The Post spoke with Alex Barton, publisher of Developing Telecom magazine,

about the importance of the telecommunications sector in Cambodia.

Why is the telecom sector so important for the economic and social development

of a country?

There have been surveys going back over many years clearly indicating that improved

communications directly correlate to economic development which, in turn, can lead

to improved social conditions. It is one of the measures of economic development

used by the UN. Broadly, improved communications enable business and government to

function more efficiently - as economists say, more efficient allocation of resources.

During Cambodia's period of unrest most of the ''terrestrial" networks were

destroyed. These have been replaced recently by mobile networks in urban centers

- mostly through foreign investment. Is this a common trend in developing countries?

Very common. Wireless networks have become the dominant means of extending communications

in developing countries in the last six years because the economic case is far stronger

than for fixed networks.

This trend will become even greater in the future. Even where legacy fixed infrastructure

has not been destroyed, developments in technology and demand mean that it no longer

meets current requirements and needs upgrading.

The cost of upgrading it is much greater than the cost of starting over with wireless

technologies. Most legacy fixed wire carriers were state controlled monopolies, bureaucratic

and slow to respond to market demands.

Wireless operators have been fast to respond to demand, even when state controlled,

because liberalization and competition has been forced onto markets, initially by

public demand from wealthy urban elites but now from across society.

What you are witnessing in many developing countries, including Cambodia, is "technology

leap frogging."

Is there a risk that the rural popuation will be left out?

Not at all. The cost of providing wireless services to remote areas is much lower

than providing fixed wire services and installation is much faster and easier.

Cambodia has the highest percentage of mobile phone use in the world - over 90

percent. What does this disparity show?

It shows that Cambodia is further down the road than you might think! Terrestrial

networks are important if you want to transmit large amounts of data. But this is

not important for most people. The most important thing is to have real competition

to keep prices for users as low as possible.

Is it possible for the government to be both regulator and market participant?

Look next door at Thailand - what it the source of the PM's wealth? Even where regulators

are "independent" the power of government patronage is such that they often

are not truly independent. Governments can of course claim to be operating in the

"national interest" by encouraging the development of communications.

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