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These reports, written by volunteers, summarise information for people not able to attend the sessions. Their comprehensiveness and accuracy are not guaranteed. For more information, please contact the presenters directly. Their e-mail addresses are available at http://www.isoc.org/inet98/program.shtml

Track 5: Globalisation and Regional implications

Session: The Internet and the transformation of the global telecommunication industry

By Melisa Makzume, 22 July 1998

The main question is: what is the role of the Internet in global telecommunications? There are two related issues: what is the impact of the Internet on traditional telecommunications? And how the Internet is a challenge for basic communication systems (fax, phone)?

In early 80’s, when the Internet appeared, it had little impact. The telecommunications industry did not know how to introduce it into their institutions. In fact, their bureaucratic system had difficulties understanding the flexible nature of the Internet.

The birth of the PC changed the role of the Internet in telecommunications. The fact that everyone could use a PC made the emancipation of the Internet easier. Since 1985, the net has developed and is now able to provide fax and telephony. The growth of its utilisation shows its importance today. Internet is not only a traditional communication system. It also offers information in a larger way; it brings the world to our screen! This is the challenge for fax and telephony. In fact, faxes do not give the possibility to buy a book from New York as we sit in Geneva…

But the real challenge is not in bringing wider information because we can not compare it to traditional communication systems. The real competition between the net and the basic telecommunications systems is the price. If the Net costs less than the traditional communications, it is because it is priced by megabytes instead of the distance between two cities or countries….

Moreover, the services cost less too because the money you spend in one state has not the same value in another state (20 dollars in Switzerland has not the same value in a developing state like Turkey!). The only solution, according to the speaker, for the basic telecommunication companies to challenge the net is probably to monopolise it.

In conclusion, the Internet is on the way to supply fax and telephony.

But the debate is still open on the main point raised by the net: the price. In fact, intra-European communication is more expansive than Europe-USA communication. So, there is a tendency towards a system centred in the United States. The final question is "is that a single market"?