Introduction

The economic and regulatory dynamics in the telecommunications sector is the subject of this study. Telecommunications are increasingly recognized as a key component in the infrastructure of economic development (Saunders et al. 1994, p. 3). The link between telecommunications infrastructure investment and economic performance is well established empirically and is significantly positive (Röller and Wavermann 2001, p. 921).

The telecommunications market as a very dynamic market depends on both innovations and investment in technologies, products and services. A high degree of innovation is the main characteristic of the telecommunications industry and ICT sector, respectively (OECD 2007a, p. 79, 2006, p. 14). The development of new technologies is emerging at a rapid pace. As a result, a high level of investment is required to maintain a modern state of the telecommunications sector.