خطرات و پاداش ها در جهانی شدن ارتباطات از راه دور در اقتصادهای در حال ظهور

The telecommunications industry in emerging markets has been transformed from a collection of mostly state-owned, national companies to one with many privately owned, multinational corporations (MNCs). Using examples from Latin America, this dramatic reconfiguration is explained as resulting from the dynamic interplay between country and firm strategies. It is further argued that first-mover MNCs reaped greater profits than late-mover MNCs, whereas timing had the opposite consequence for host countries. First-mover MNCs had the advantage of buying the incumbent state enterprise, enjoying monopoly privileges, making preemptive investments, leveraging political connections, and adopting entry-deterring policies to minimize competition. But early-reforming countries had to contend with the region’s lack of credibility with investors by deeply discounting sale price, offering special privileges and protections, and absorbing risks that late-reforming countries were able to pass on to MNCs. The paper concludes that telecommunications no longer offers foreign investors easy riches like those enjoyed by first-moving MNCs in first-reforming countries. Late-moving firms, especially in late-reforming countries, are exposed not only to governments with higher bargaining power but also to greater regulatory and competitive risks. This paper considers the risks and rewards for firms and countries that take advantage of newly arising opportunities in the telecommunications industry in emerging markets. The three trends sweeping across this industry are (1) the privatization of state-owned enterprises; (2) deregulation of the sector; and (3) globalization of the sector occurring through the participation of foreign capital in privatizations and in new entry after deregulation. Although these trends are occurring in a number of countries, the examples in this paper are drawn from Latin America, which was first among the emerging economies to embrace these trends. Therefore, the Latin America experience may portend things to come in telecommunications in other emerging economies (EEs). There is no widely accepted definition of “emerging economies,” although the term is generally used to refer to both developing and transitional economies, each of which, in turn, is a heterogeneous set. Yet, these disparate countries are different from industrialized countries in two important respects: First, their market-supporting institutions are relatively underdeveloped (Alston et al., 1996), even though many of them embraced market-friendly policies, such as deregulation and privatization, in the 1990s. Second, their credibility with private investors, especially foreign investors, was quite low when they began to open up their economies in the late 1980s or early 1990s (Sader, 1995). Weak market-supporting institutions and low credibility made it hard for these countries to privatize activities previously reserved for state-owned enterprises. Transitional economies were much worse off on these dimensions, because state ownership accounted for 70–100% of their GDP, compared to the modal value of only 15% of GDP in mixed-economy developing countries (World Bank, 1995, p. 268–270). However, even in the latter, the privatization of monopolistic firms posed serious challenges of competition policy and regulation after privatization. Compared to many other emerging economies, Latin American nations’ market-supporting institutions were stronger, because their private sectors, their capital markets, and their labor markets were relatively well developed; after all, Latin America was home to middle-income rather than low-income countries. Yet, in the late 1980s, the credibility of Latin American governments with local and foreign investors was at its nadir, in the aftermath of the debt crisis of 1982, and the recessions, inflation, and expansion of state control that ensued. How well, then, did telecommunications deregulation and privatization work in the region? Our conclusion is that some host countries and MNCs have profited more than others from the reforms in this sector, depending on the timing of reform (in the case of countries) and the timing of entry (in the case of firms). In Latin America, first-mover status created substantial advantages for firms, but it seems to have created significant disadvantages for host countries. The opposite impact of timing on firms and countries in Latin America arose principally because telecommunications reform was initiated in the early-reforming Latin American nations in the midst of high economic and political uncertainty. We would argue that the basic framework proposed in this article can be applied to other infrastructure sectors and to other emerging economies, especially transitional economies.

The framework of first-mover firms and first-reforming countries proposed in this article goes some distance in explaining the rewards that firms and countries have reaped from telecommunications privatization and reform. Although the importance of first-mover advantages in this sector have been noted by others (e.g., Sarkar et al., 1999), we believe that an additional consideration is whether foreign investors are first-movers in early- or late-reforming countries. Although moving first has made a large difference to the returns that MNCs have been able to earn, moving first has tended to reduce the returns captured by governments. Table 4summarizes the advantages enjoyed by first-mover MNCs and late-reforming countries. First-mover MNCs capture monopoly rents that were not competed away by bidders for the telephone company, because in first-reforming countries there were usually very few bidders, all of whom discounted future cash flows heavily to adjust for perceived risks. In addition, first-movers deterred entry by late-movers when exclusivity ended, by lobbying regulators, by delaying or charging too much for interconnection with the public network, by locking in prime customers, and by cross-subsidizing competitive activities with profits from noncompetitive activities.On the other hand, late-reforming countries benefited from the credibility-building actions of their first-reforming neighbors. When investors saw that countries like Argentina and Mexico implemented their telephone privatizations quickly and allowed MNCs to earn very high returns, they flocked to late-reforming countries like Peru and Brazil. As a result, late privatizers offered fewer concessions or privileges to MNCs (notably, shorter exclusivity periods) and yet managed to get multiple bids from reputable MNCs. Late-reforming countries also received higher bids because their markets were more valuable to first-mover MNCs in neighboring countries, because of network externalities and economies of geographic scope. In addition, panic bidding by late-mover MNCs sometimes took bids to surprisingly high levels, as seen in the cellular license auctions in Brazil. The implication of these findings for policy makers in emerging economies is that reforming telecommunications slowly or slightly later than neighboring countries may be an advantage rather than a disadvantage, if the country can benefit from a positive contagion effect, if it can learn from the privatization experience of its neighbors, and if the privatization of telephone companies in adjoining countries increases the value of its own telephone company. Our findings also have important, strategic implications for private firms, including MNCs: First, the study suggests that first-mover advantages are enormous in industries like telecommunications. The most important reason for this is that the first-mover—and the first-mover alone—gets to buy the incumbent state-owned telephone company, which inevitably enjoys high market power. Even if the government ends that artificial monopoly power after privatization, the competitive advantages of incumbency are tremendous, in terms of captive customers, dependence of competitors on the incumbent’s local network, physical assets already in place, and prime locations for offices or exchanges. Combined with the incumbent firm’s political clout, even after privatization, it can be very difficult and costly for new entrants to steal share away from it. Second, for the above reason, private investors may need to rethink their knee-jerk reaction to investing in telecommunications privatizations in emerging economies—which is to be overwhelmed by perceived risks of doing business in these countries, especially in early-reforming countries. The correct response to these political and economic risks is not to overdiscount future cash flows and therefore bid too low or not bid at all, but to include clauses that protect one against those risks. Indeed, the firms that entered these markets as first-movers were usually able to protect themselves fully against many such risks, including inflation, exchange rate volatility, takeover threats, political turmoil, expropriation, or future restrictions on repatriation. Third, private investors must recognize that the profit potential of telecommunications privatization is likely to be considerably lower in late-reforming countries than in early-reforming countries. In late-reforming countries, one must guard against overoptimism and the temptation to offer whatever it takes to win the bidding war. Finally, late-moving firms should be prepared for very tough competition from the first-mover and other late-moving firms. In this scenario, as seen in the experiences of companies like GTE in Argentina, or AT&T and MCI in Mexico, there is a real possibility of chronically negative returns, because the cost of entry into the market can be very high whereas profits can be hard to come by because of vicious competition. We believe that the analysis presented here might apply equally to telecommunications restructuring in other parts of the emerging world, especially Eastern/Central Europe, which has tended to follow the Latin American pattern shown in Figure 1 (e.g., in countries like the Czech Republic, Hungary, and Poland). Furthermore, we believe that the interplay between timing of firm entry and timing of country reform may also explain the rewards earned by MNCs and host countries in other service sectors that are being privatized and deregulated, such as electricity, roads, and railroads. In varying degrees, the some of these industries also promise significant first-mover advantages, though perhaps not as much as in telecommunications. We hope future research will extend the ideas presented in this article in these new directions. Cuervo–Cazurra 1998b