Telecommunications in Europe.

• Author: Chaudhuri, Jay

Eli Noam. (Oxford, UK: Oxford University Press, 1992) 523 pp.

Telecommunications in Europe takes on the bold task of comprehensively addressing the economic and political issues affecting the telecommunications industry in the region. A companion volume to Television in Europe, Telecommunications in Europe is timely: Telecommunication services remain a contentious issue for the General Agreement on Tariffs and Trade (GATT) negotiations, and the Clinton administration, spurred on by Vice President Al Gore, intends to create a so-called information superhighway.

Eli Noam, professor of finance and economics at Columbia University's Graduate School of Business, analyzes "the rise and beginning of the telecommunications in Europe." Part one of the book recounts the changes and forces that alter the conventional post, telephone and telegraph (PTT) systems. Part two focuses on the individual countries in Europe, including East Central Europe. In part three, Noam considers many telecommunications topics, including industrial policy, transatlantic-trade friction and the clashes between the differing policy approaches taken on both sides of the Atlantic. The final section examines the future of the industry in Europe.

The book opens with a focus on the origin of Europe's centralized network system of communication, starting with the postal system -- an organization that eventually generated a great amount of revenues for European rulers and thus "was ardently protected through the centuries against encroachment by private competitors and by states." Noam goes on to describe that in time a unified state monopoly system of PTTs was established throughout Europe, and that it developed immense power because of the gradual importance of telecommunications and the extensive command that the industry possessed -- both economically and politically.

Noam aptly terms the system the "postal-industrial complex." The author tells us, for instance, that PTTs are among the largest employers in their countries; that in Germany alone, before reunification the Bundespost had the single largest work force in the nation -- some half a million employees. These PTTs justified their telecommunications monopolies through the concept of public service: universal, accessible, affordable and redistributive.

Noam argues that this traditional system encountered pressures and fierce political debates because of its success, not due to its failure. He writes:

As the system...