To Own the Phone : Spatial Diffusion, Ownership and Regulation of Telephone Service in Argentina, 1878-1990

Abstract: Telephone service in Argentina has since its beginning been characterized as one of the most developed in South America. Regarding its development, two distinct periods can be identified. An initial period of private ownership extended from 1878 to 1946. In 1946, when the largest telephone company was bought by the state, a period of predominant state-ownership began that lasted until 1990 when the state-owned company was privatized. During this period, telephone service remained operated by private companies in several provinces. The aim of the study is to analyze the diffusion of telephone service in Argentina at the national and provincial levels focusing on the role of supply, demand, ownership and state regulation. Questions are raised on how these factors have influenced the development of telephone service in terms of number of subscriber lines and exchanges. Questions regarding the relationship between telecommunications and development are also addressed. An overview of the international expansion of the telephone from the early days beginning in the 1880s through to the 1980s is presented, particularly in the Americas and Europe, aiming to provide a picture of the international environment in which the events of the Argentine telecommunications development took place. Here, issues concerning ownership, regulation and spatial expansion of the telephone are highlighted in order to relate the empirical content to the analytical aim of the study. At the national level, the analysis focuses on the origins and expansion of telephone service in Argentina from 1878 to 1990. The evolution of supply and demand of telephones as well as the importance of changes in ownership and regulation during different periods is analyzed in an effort to highlight their relevance for the expansion of telephone service in Argentina. At the provincial level, the diffusion of telephone exchanges in the urban systems of a number of Argentine provinces is analyzed during a period of more than five decades. From the comparative analysis between the provinces, three stages in the process of diffusion are identified and the significance of owner¬ship, competition and regulation for the diffusion of the telephone in the provinces in question during different periods is discussed. Conclusions are also drawn regarding the contribution of telecommunications in the reduction of disparities among regions. The empirical evidence does not suggest that telecommunications contributed to more even development.