Votivkirche, Vienna
Traditional telephone
The Austrian PTT (OePTV) is government-owned and, until April 1, 1994, comprised a monopoly in local, trunk, and international competition, data communications, and leased lines, and wireless telephony. Thus, Austria was, and still is, one of the least deregulated countries in Europe. 21
However, EU law requires all member countries to dissolve PTT monopolies by the end of 1998. Hence, in April 1994, the Austrian government passed which represented the first step towards enforcing deregulation of Austrian telecommunication. Solely wired telephony and infrastructure will be monopolized until January 1, 1998. 22 In 1996, the PTT will be disengaged from the Austrian budget and become its own entity (Post und Telekom Austria AG), governed by civil law, but 100% owned by the Republic of Austria. So far, there is no intention by the Republic of Austria to privatize the PTT. Rather, the PTT will be split into three profit centers, i.e., Telecommunications, Mail Services, and Bus Transportation. 23 Wireless telephony will be spun off and become a separate entity.
As soon as deregulation takes place, many new providers plan to enter the market, e.g. competitive wired service providers as well as cable companies, utilities, or the railroad company. In order to fight competition and expand its services, the PTT has only recently signed a memorandum of understanding (MoU) with Uniworld, a powerful alliance between Unisource (the Dutch, Spanish, Swedish and Swiss PTTs, now joined by AT&T. 24
Cellular telephone
The first monopoly to fall in Austria was in wireless telephony. The new private E-net, based on GSM technology, was publicly tendered in 1995. It was the first cooperation by the local utility companies which formed United Telekom Austria to make a bid for the cellular service. However, United Telekom Austria was prohibited to participate in the bidding. The contract was awarded to Oe-Call, a consortium comprising Siemens, BAWAG (Bank), EA Generali (Insurance), Bundeslaender Versicherung (Insurance), and DeTeMobil. The private provider will offers special tariffs but the infrastructure used is still a monopoly of the PTT. Only in 1998 will private companies be allowed to build their own private infrastructure networks. 25
Cable television
The utilities and other private cable companies have built a large fiber optic and satellite infrastructure throughout Austria. In 1998, they will begin to compete with the Austrian PTT and will offer multimedia services through cable connections (60 channels, Pay-TV, Home shopping, Pay-Per-View, HDTV, computer connections, phone) When deregulation takes place, the cable providers will lack high speed lines linking large cities. Hence, a cooperation with the OeBB and utilities seems a logical step. 26
Radio and television
The Austrian Broadcasting Corporation (ORF) is also state-owned. Still being in the stone age of a TV and Radio broadcasting monopoly, the Austria government may -after many years of preparation - pass a law that would allow private radio. Private television networks are still a vision. The cable companies would be eager to offer their own broadcasting services because they have already established the infrastructure to offer such services. 27 Today, the only competition comes from German station that are provided by cable or satellite TV and radio stations established close to the border in a neighbor country reaching into Austria.
The emerging telecommunications market
Whether wired or wireless telephony, data or communication services, Austria's market for telecom services is expected to grow tremendously. Currently the total market is estimated to amount to ATS 50bn ($ 5bn). By 2010, total market value is forecast at ATS 200 bn ($ 20bn), with much better quality and much lower prices. 28 With ATS 40bn ($ 4bn), the wired telephony accounts for the largest chunk of revenue. The wireless market is only some two to three billion ATS.
The West European services market (both fixed and mobile networks) is set to reach $212 bn in 2000 ($160 bn in 1995). The best fixed network opportunities will arise in Austria, Germany, and France, because the markets are large and the incumbents operators vulnerable. Austria, Germany, France, Italy, and Spain will also offer the best opportunities in the long distance market. The chances of a new telecommunication venture succeeding in the new environment depend on factors such as regulations, the strength of the incumbent operator, the size and the growth rate of the market. 29 All factors support the believe that there is a significant opportunity in the Austrian telecommunications market.
Market competitiveness and prices
Active and potential users complain that the cost of using the PTT's services are too high. The substantial telecom expenditures are a significant barrier to development of the IT sophistication in Austria. Although prices have been reduced in recent months in the area of wired telephony and Internet usage, customers will have to wait until 1998 for prices to fall substantially. Today, costs may run at a multiple of U.S. expenditures for similar services.
Dialing for dollars: Cost of a 3-minute phone call to the U.S. from:
30
| Country | $ |
| Sweden | 2.62 |
| Germany | 3.49 |
| Austria | 3.53 |
| Italy | 4.28 |
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