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As sharing among connections were almost eliminated and it was possible to complete a call autonomously Blumberg et al.


In this respect, the mobile companies invested directly in VoIP technology right from the beginning, guaranteeing long-distance communication among their consumers using their own infrastructure and reducing the need to share landline networks. In large countries such as the USA, the cost of infrastructure development is high and pioneering companies have been able to optimize their present structure among providers Crandall, The biggest companies have benefited the most Davies et al.

Some landline and mobile phone companies that have expanded their infrastructure to provide long-distance services to large scale consumers have increased their business by selling or renting bandwidth Green, Smaller companies, or companies with limited reach, have adopted the unique solution of renting from the largest companies. With dedicated rented links, and using connections via fiber optics or satellite, the main emphasis was on the implemented protocol as well as the boundary host equipment.

These companies operated VoIP connections for international calls between two landline companies and developed what they called an international voice call center Van de Klundert et al.

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Between the countries, the transmission and reception are realized between the landline companies and the users across a data link as VoIP technology. While these sources increase the number of service providers in a particular market, they create regulatory challenges as discussed below. Based on the SI presented above, and in the services provided by the landline and mobile providers, service convergence allows transmission of a voice call as if it were data to long-distance locations. This reduces costs due to the technology applied as well as taxes saved. Since there is no regulation for VoIP systems, voice communication is only evaluated when the conventional voice system is used via a landline or mobile network.

Service convergence in the mobile communication industry has made the regulatory oversight scenario even worse. Previously, the regulator had control of the actual interurban mobile phone calls when the system was shared between landline and mobile providers. This is because when a cell phone call is taken out of its local area it informs the closest tower of its location and code of use, and the tower in that area is obliged to send the data to a landline to connect the two different areas state or country. With the autonomous systems developed by mobile operators, it is no longer easy to determine the location of a mobile phone because only the mobile provider has this information.

Without any regulation equipment capable of controlling all calls, it is difficult to identify the number being called or the location of the originating call, except by the mobile provider.

Different technologies have different regulations, and in some cases, such as in the USA, these regulations change between state and federal levels Cherry, Another factor in the USA is vertical integration, as many telecommunication providers offer landline, mobile, Internet, and television at the same time. These integrations are internal to a specific provider, which connects a call via many diverse routes by taking advantage of TC Shin, ; Santos et al. Figure 3 shows three connections based on different services that can provide good voice communication with different costs and the same approximate quality.

Table 1 shows the difference in costs based on the kind of service. In this example, a ten minute voice communication between Brazil and the USA is priced in three different ways. The first case uses VoIP between two Internet points and does not take into account the ADSL connection fee as it is used for many different purposes, so the monthly fee is included in general use and the connection cost is free for this kind of voice communication.

The second case uses a normal landline and does not take into account the line rental fee for both phones based on the fact that the phone has other uses. Landline costs are charged based on minutes used. In the last case, not including the Internet fee origin and the telephone fee destination , the cost is just the local charge, which is a few cents per minute. Figure 3.

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Voice communication using different services and connectivity. When a company uses VoIP between its branches for internal communications it is an entrepreneurial connectivity fair use. Nevertheless, when a company uses the technology to integrate countries and continents without paying any fee to the government for the international connectivity, and when they are commercializing the service, they have an advantage over other companies using normal technology.

Even when providers use the same technology, reduce the resources needed to connect two clients, and save on infrastructure requirements, the final price to consumers remains the same; this is unfair to end consumers that are still paying old prices for new technologies, despite savings in connectivity benefitting providers.

Table 1. Service costs for various long-distance connectivity methods, charged or not.

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It was predicted that the competitive purpose of using new technologies was that providers would offer the best prices, increasing competition in the market; however, in countries with lobbying, poor regulation, and poor social responsibility, providers prefer to maintain high prices and unfairly increase their profits instead of profiting by increasing use and users. The problem created by SI, TC, and non-regulation is one of an uneven competitive field where smaller companies are at a disadvantage, especially when they are authorized to offer only one single service.

Larger companies are able to employ different technologies, taking advantage of convergence Gill, to reduce costs. Figure 4 shows the distribution between price and connectivity in this market. The matrix clearly shows two things. Figure 4.