Communication Networks Economy
Communication Networks Economy
The Challenges of Building a Network
The user cost of a network is primarily affected by the guidelines put in place for its construction and management. The quality and security of the network dominate the choices made during its development, as they are indicators of a good level of usage on the part of customers and, consequently, of a good return on investment. However, well before taking the economic aspects of a network into account, conditions in the real world very often make it necessary to establish a network as soon as possible in specific places across the territory for political reasons.
1.1. Construction of a national network
1.1.1. Network creation priorities
The construction of a network is the result of will and political strategy. It requires jurisprudence required for managing the so-called "rare resources" attached to network operation. Regulations must be compatible with the development of the network.
188.8.131.52. Primary physical conditions
Responding to an unsatisfied demand, communications networks are constructed year after year, although the hypotheses taken into account at the start of planning may be substantially modified over time. The layout of the network should be designed to be able, going forward, to respond to the needs expressed by citizens at the best possible price. Frugality (here meaning the economical use of resources) should be associated with the need to serve the entire population. The layout of the network must correspond to the territory's organizational needs, as decided by its political authorities. In the absence of a specific national directive, the person responsible should act "in the best possible way" and take forward-looking actions. From its inception, the network should be designed to serve the majority of large centers through grids that ensure the duplication of communications transmissions, with the largest number of users able to connect to the national network at a later stage.
The implementation of a national network requires planning made up of various stages and taking place over a number of years. Over time, this plan is often remodeled because of new technologies becoming available, proposals for economic development or new needs expressed by a new distribution of customers in the territory.
184.108.40.206. Scalability of regulations
Communications regulations are managed to accommodate any future developments. Initially, the State, which is the source of the project, fixes the legal rules on creating a national operating company (monopoly, cooperative management, administration, delegation to a designated commercial body), as well as the relevant primary legal measures (the rights of public authorities, State requirements, expropriation, certification and status of staff, establishment of user rights and of charges for services open to the public).
The opening of the communications services sector to competition introduces new aspects of regulation, taking into account various standard phases of development (basic services, infrastructure, combining fixed and mobile networks, for example). It is seemingly the relevance of the latest technical and economic events that, as a result of actual demand and economies of scale carried out on network costs, justifies the modification of regulations. The objective is to ensure that the available network services can be accessed by all citizens, in any part of the country and at the best price, without unbalancing the budgets of authorized operating companies, without allowing any of the actors to establish dominance and without calling into question their infrastructure roll out.
220.127.116.11. Initial investments
As a result, significant investments only lose value when they are made too quickly and they should correspond to a purpose highly valued by users. A