Pride, prejudice and precluding infrastructure competition for government-owned networks

[Commentary] It is a truth universally acknowledged that a telco in possession of market power will seek to use its position to foreclose competition. This is true regardless of whether the telco is privately or publicly owned.

Recent events in Australia confirm that governments, when conflicted by their joint roles as network owners and custodians of regulatory policy and legislation, are prepared to sacrifice the benefits of competition in order to pursue redistributive agendas. This is true even if such agendas are more costly for consumers and taxpayers in the long run than doing nothing at all.

[Howell is general manager for the New Zealand Institute for the Study of Competition and Regulation]