World Telecommunication Day 97

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'97

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Teleconomics
The economics of telecommunications

"Today, humankind is taking the next step in economic and social evolution toward a global information economy and society. In the information era which is now beginning, an increasing number of jobs will involve the creation, production or distribution of information products and services. Human and artificial intelligence will be the foundation of wealth..."

Pekka Tarjanne
Secretary-General, International Telecommunication Union


	Total trade in telecommunications (1995): US$ 96 billion Total trade in telecommunications (1990): US$ 50 billion
	Value of equipment exports in 1995: US$ 58 billion Percentage change in value since 1994: +20 Percentage change in value since 1990: +100
	Value of telecommunication services market 1995: US$ 600 billion Value of telecommunication services market 1990: US$ 400 billion
	International telephone calls, total minutes, 1995: 60 billion International telephone calls, total minutes, 1975: 4 billion Revenues from international telephone calls, 1995: US$53 billion
	Number of new telephone lines added worldwide in 1995: 45 million Number of new telephone lines added worldwide in 1994: 38 million Percentage, of all new lines in 1995, that were added in Asia: 50 Percentage, of all new lines in 1995, that were added in China: 33

Some points from the report:

"The boom in export trade has been largely driven by growth in demand for telecommunication services, which is in turn driving the construction and modernization of networks, both traditional fixed line networks and other types of network such as cellular or the Internet."

"Until recently, opportunities for trade in telecommunications services have been more limited than for equipment, due to governmental regimes which maintained monopoly service provision by a national carrier. The global trend now is towards a freeing up of markets, and this is expected to lead to strong growth in international trade in services."

[All data based on the World Telecommunication Development Report (WTDR). The report, prepared by the ITU, tracks global changes in the telecommunications sector, and includes extensive analysis of market trends as well as comprehensive statistical information on various market segments.]

Activities

Using the data in the text, calculate the value of each of the points below:
1. equipment exports in 1994? in 1990?
2. annual growth rate (percent) in the number of minutes used for international calls since 1975?
3. number of new telephone lines were added in Asia in 1995?
If revenues from international calls represent 8.7% of the total market in telecommunication services, what is the value of the total services market?
Bonus: Read the two points mentioned from the World Telecommunication Development Report - you can also go to the ITU site (www.itu.ch) and read about the report in more detail. Explain how the supply and demand of services and equipment are linked and how these are changing with shifts in economic and political systems.