Network industries in the United States such as telecommunications, electricity, and natural gas have traditionally involved private companies subject to price regulation by state and federal government agencies. Regulation has been justified by the perception that at least some aspect of each industry is a natural monopoly, such as the local telephone network, the high-voltage electricity transmission network, and the natural gas pipeline system. Other countries lack a similar regulatory tradition because foreign governments directly owned the companies that provided such services. However, the recent trend of privatization has prompted the need for other countries to establish regulatory systems.

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