Let the market take its time: Ewan Sutherland says success depends on user demand - A User's View - Column

For the last decade, the user view of regulatory principles has been an easy stall to set out. The principles concern neutrality, non-discrimination, genuine independence, encouragement of competition, open consultations and quick decision making. Drawn-out processes favor those with deep pockets, invariably the incumbent operators. Yet it is increasingly the financial markets that are deciding the future of telecoms.

Regulation does not happen in an economic vacuum. With liberalization comes a stronger influence of the economic cycle. Shares go down as well as up--sometimes certificates become memento mail.

Today, we have a combination of recession and a market that dislikes or distrusts telecoms operators. Distrust is understandable, given the past behavior of operators and their propensity to exaggerate or just not know what was going on. The financial markets' dislike of telecoms is stifling research and development and depriving start-ups of cash. This prolongs the dominance of a few incumbents and delays the day when the markets might become genuinely competitive.

It is disruptive and chaotic for users when a telco suddenly goes out of business. However, it is something we have to live with as part of the price of the slow movement towards competitive markets. It requires a management of the risks concerned and appropriate plans for such contingencies.

Adverse economic circumstances should not cloud judgements. Now is not the time for governments to intervene to "save" operators, even from their own self-consuming greed. Nor should policies be "eased." Success depends on the users of telecommunications and not on the here today, gone tomorrow operators.

Ewan Sutherland is the executive director of INTUG Europe, the International Telecommunications User Group, based in Brussels

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