International telecommunications settlement arrangements: An unsustainable inheritance?

Henry Ergas and Paul Paterson

Telecommunications Policy, 1991, vol. 15, issue 1, 29-48

Abstract: Thirty years ago the world's carriers established a system of international payments which recognized their interdependence and the requirement to provide services jointly. The accounting rate arrangements, as then devised, met this need while creating incentives for capacity expansion and network growth. Today's challenge is to modify these arrangements in the light of the new phase of development of the telecommunications network: a phase in which the network is no longer supply- constrained but demand-driven; in which the carriers can no longer exercise tight control over the network and its uses; and in which increasingly powerful customers and competitors will set the pace. Reform of the present arrangements is both inevitable and desirable.

Date: 1991
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