Home Latin America III 1997 Portugal: Guarantee of Unrestricted Accessto the Information Society

Portugal: Guarantee of Unrestricted Accessto the Information Society

by david.nunes
Minister Leonor Coutinho Issue: Latin America III 1997
Article no.: 10
Topic: Portugal: Guarantee of Unrestricted Accessto the Information Society
Author: Minister Leonor Coutinho
Title: Ministry
Organisation: Housing and Communications, Portugal
PDF size: 32KB

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Article abstract

The evolution of modern telecommunications represents one of the greatest social and legislative challenges. This article showcases Portugal’s vision of not only providing its population with access to a developed telecommunications network, which will rightfully allow it to play a full role in the Information Society, but also to develop a framework which will provide all of the instruments that will permit the results of liberalisation to be in the best interest of operators, industry and consumers alike.

Full Article

Telecommunications are undergoing a period of major, irreversible change. These are decisive times in global terms and Portugal has been doing its best to accompany developments and overcome the challenges which continue to appear in the sector. The two pillars upon which we have based our actions, are the definition of a regulatory framework, which sets out clear rules for the total liberalisation of the Portuguese market, and the choice of a policy favouring major investments in infrastructures. The Government is concerned with the need to provide the entire Portuguese population with access to a developed telecommunications network, which will rightfully allow it to playa full role in the Information Society. The objective is being fulfilled: Portugal has been consolidating its advantages, even when compared to much larger European countries and operators, particularly over the last 2 years. Telecommunications Evolution The current scenario in Portugal is the result of an evolution which has been gaining pace. Telecommunications, at the beginning of the nineties, represented 2.5% of GDP. This had already increased to 4% in 1996, and turnover between 1991 and 1996 increased by 129%. There is no doubt that the sector will, over the next few years, continue to expand at a higher rate than the average for the rest of the Portuguese economy. The density of the total number of main lines is also representative of this evolution. Portugal had only 27 main lines per 100 inhabitants in 1991. This number has already risen to 38 and is comparable with the average in the rest of Europe. In 1991, only 50% of the network had been digitalised. The current figure of 80% is expected to rise to 98% by the end of 1998. These figures are the result of the massive investments in infrastructure which have been made over the last 2 years and which have always been 3.5% over the investment rate for the rest of the country as a whole. The figures are rising, on account of both the licensing of new operators and the volume of investment being made on infrastructure, already programmed up until the end of the year 2000, at which time the last restriction on the fixed telephone service for the Portuguese market will disappear, to be followed by total liberalisation. Progressive Liberalisation Process The progressive liberalisation process of the Portuguese market was introduced at the beginning of the nineties through the creation of the Portuguese Institute for Communications (ICP), which is an independent regulatory body. Licenses were also awarded to the first fixed complementary services, cellular telephone companies, and paging and cable television operators. Six years later, Portugal has around 100 companies certified to provide telecommunications services – double the number of 1995. The mobile service for cellular phones has been warmly welcomed by the market and has enjoyed a growth rate of 100% in its number of subscribers, in the last 2 years. The cellular telephone penetration rate, at the end 1997, is expected to be in the region of 10%, which is much higher than the average figures for the European Union. Privatisation of Portugal Telecom The evolution of the domestic market is also evident in the partnerships which have been, or are shortly to be agreed, by Portuguese operators, and by the acceptance of the companies on stockmarkets, as well as from the growing interest of investors. The privatisation of Portugal Telecom is also highly visible, currently selling off its share capital in the European and North American financial markets. This evolution taking place in the sector has also contributed to the country’s decisive participation in the definition of the new pattern of global alliances. It has allowed Portugal Telecom to establish a strategic alignment with British Telecom and MCI as a member of Concert, for investments in international markets. The current degree of certainty involving the Portuguese telecommunications market, both as regards investors and consumers, is the result of the scenario established by this Government: a scenario involving specific deadlines for the aforementioned liberalisation as well as entry mechanisms for new market players. It is a scenario which takes into account its historical ties to Asia, South America and Africa, and which maximises investment possibilities. This is a scenario which requires the commitment of all players and which also permits sustained growth in the market and market expansion. Framework Significant steps have been taken since last year, with the opening up of private voice network and satellite services to competition. This year has seen the creation of the Basic Telecommunications Law, an element providing a framework which will ensure the open provision of infrastructure and services over time. The new fixed telephone service regulation is already part of this legal framework and establishes standards of service quality, guarantees to consumers and cost-oriented price policy parameters. The procedure for awarding a third mobile telephone operator license is also in progress and a decision may well be taken by the end of the year. All three operators will enjoy the same conditions, both as regards the number of frequencies and systems to which they will be given access. The new cable television regime, which has also been approved, will act as a lever on new business areas. It represents a potential employment generation factor and will help to revitalise the market. A content industry is expected to spring up around this area, within the framework of the Information Society. These cable networks, which are already covering 25% of Portuguese households, may provide previously liberalised telecommunications services, Internet access, interactive broadcasting services and their own radio, and television broadcasting, in addition to providing third parties with transmission capacity. The new legislative framework will also see short-term introduction of new legislation regulating the use of alternative infrastructures. The reformulation process covering the provision of paging services, including the pan European ERMES (European Radio Message System) standard, is also currently in progress. The consultation process for Digital Enhanced Cordless Telecommunication (DECT) technology is also applied to the different operators. Structuring Nature of Telecoms The evolution which has occurred over the last few years, both in terms of legislation and in social terms, shows that modem telecommunications represent one of the greatest challenges to be faced by different professional areas. They create synergies, consolidate structures conducive to socio-economic development, and permit the creation of new and better parameters designed to enhance the well-being of the population. Accordingly, due to the concern to guarantee the whole of the Portuguese population with access to a developed telecommunications network, the Portuguese Government has also encouraged initiatives in specific areas such as education and health. This includes Internet connections in all high/secondary schools and the development of the Health Information System, together with other national and European initiatives in the area of telemedicine. Conclusion Portugal firmly believes that all of these initiatives are of decisive importance in the Portuguese telecommunications sector, owing to their structuring nature. They will allow the market to develop in a healthy manner within a framework of liberalisation, setting out scheduled, irreversible deadlines, a framework which will provide all of the instruments that will permit the results of the liberalisation process to be in the best interest of operators, industry and consumers alike.

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