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Post Office Telecommunications is part of the essential infrastructure of the community. It provides local, national and global services of increasing variety. It is a growth industry that is highly capital intensive, that is growing and changing, and that is critically dependent upon its basic technology. The role of engineering innovation in the development and running of the industry is traced through the past seven decades of its existence. Trends that emerge show that engineering innovation, together with improvements in management and the exploitation of scale or growth factors, have all enabled the cost to the customer to be reduced, decade by decade, in real terms. But analysis of those trends also shows that in some sectors opportunities for further reductions through extrapolations of current engineering innovations are unlikely. Prospects for further realcost reductions seem to depend on whole-system designs exploitation of digital and microelectronic technologies and aimed at providing the increasing repertoire of services needed by our customers. But national infrastructure services of this sort, using complex, high-technology systems, and having to integrate into a global system, take time to develop and implement. They need continuity of policy and confidence in investments of men and material if they are to be timely, effective and profitable. The discrepancy between the time of a typical development cycle and a typical political cycle is discussed.