Liberalization and Regulation in the Telecommunications Sector. The Economic Background

The telecommunications sector is rapidly being transformed from a monopolistic market to a market with several suppliers. This change creates opportunities as well as problems. Policymakers face the difficult task of designing a new institutional framework which is able to support a well-functioning competitive market. In particular, regulatory measures are needed to prevent the former monopoly from exploiting the market power that remains even after the industry has become liberalized.