Taking the long road to liberalization: Telecommunications reform in the Federal Republic of Germany

Abstract

In the course of completing the Single European Market the liberalization of telecommunications is a key issue. A central question is how public policy and market mechanisms can be combined to achieve a regulatory structure that strikes a balance between public service and advanced business users' needs. This article reviews the different stages of the lengthy German telecommunications reform with a focus on the different interests involved. It then critically assesses the ability of the new regulatory framework to meet divergent demands. It is argued that the opportunity of a lengthy reform process to achieve a balanced approach was inadequately seized. Finally the major difficulties caused by the recent reunification of the country are analysed. These a are posing such a challenge that the regulatory structure in Germany could enter a new phase of uncertainty.