Investment and Regulation in Telecommunications

This article presents the difficulties associated with the implementation of the regulatory goal of promoting investment and innovation within the area of sector specific regulation in telecoms. The encouragement of efficient investment is one of the major goals reflected in the EC and domestic legal rules on telecoms access as well as price- and rate of return regulation. The law and the interplay of the interests of incumbents and alternative operators create a fertile soil for the emergence of various regulatory concepts of stimulating investment and facility-based competition. Considered here are the concepts most frequently referred to in this context including: the notion of new and emerging markets, the ladder of investment theory, sunset clauses and dynamic pricing policies. However, most of these concepts had little influence on regulatory practice so far, seeing as telecoms regulation is mostly directed at service competition and effective utilisation of existing infrastructures. This fact is the result of national regulators balancing their various regulatory goals in the existing technical and economic environment of the sector. The approach of the Polish regulatory authority towards these concepts constitutes an example of this reality. The urgent need to establish a new policy for next generation networks and access, bringing new technologies and business models to the sector, will have to induce more recognition for some concepts presented in this article.