China, with its highly regulated market, does better at ADSL penetration than free market alternatives such as the U.S., argues this blog entry.
“China will soon pass the U.S. as the country with the most broadband users, probably mid-2007 at 55 million to 60 million. Almost all is DSL. China Telecom’s 23.5 million subscribers are more than the entire U.S.; China Netcom 13.5 million makes them the world’s second largest DSL carrier. China also has 365 million land lines and 426 million wireless subscribers. China’s economy is on the fastest rise in history, growing twice as fast as West Germany’s “economic miracle” or any period in U.S. history.
These extraordinary results were achieved by well regulated monopolies, an alternate strategy to the (often weak) competition in the West. Chinese telcos are government controlled beyond the dreams of any free market regulator. CEOs follow government orders or are sacked, with the CEOs leaving CT and CN last year. Competition can serve consumers well, but so can effective regulation. Empirically, the world leaders were built with strong regulation in France, Korea, Japan—and China.”