Fixed and mobile competition in transition economies

The main aim of this paper is to explore the competition between traditional fixed line and mobile services across Eastern Europe and the Former Soviet Union. Whilst there have been some pioneer studies in the US, empirical evidence for other regions is very limited. Transition countries witnessed important trends in the mobile segment of the market. First, mobile penetration rates have been growing at exponential rates, whereas fixed line penetration rates have at best stagnated. The present analysis is based on empirical evidence based on country level data and case studies, as well as enterprise level data based on major surveys that the EBRD and the World Bank undertook in 2002 across all transition economies. Econometric analysis at the enterprise level shows some interesting results, including evidence of strong network externalities and fixed to mobile substitution effects at the country level.     

Spectrum allocation and its relevance for competition

Spectrum is one of the most important production factors for mobile telecommunications operators. Spectrum policy is paramount as spectrum is a scarce resource allocated by regulatory authorities. Hence, when allocating spectrum and determining the potential use of spectrum, the regulatory authorities have a significant influence on the competitive situation in mobile markets.     

Compatibility and competition in airlines demand side network effects

Network effects arising in air transport markets are usually viewed as resulting from the implications of joint production on the cost side. In this paper, we focus on network effects originating on the demand side. We consider a network that links three cities involving two direct and one indirect connection. Two carriers, with asymmetric traffic rights on this network compete sequentially: at the first stage, they choose their departure times; at the second, they set prices. We show that in order to compensate its network disadvantage the ‘weak’ carrier chooses its departure time as close as possible to its competitor's. This is in contrast to the usual maximum differentiation principle. The network effect intensifies price competition. Depending on the size of the market and on consumers valuation of waiting time, various subgame perfect equilibrium configurations are exhibited.     

Joint pricing and procurement of fashion products in the existence of clearance markets

This paper focuses on the joint pricing and procurement of fashion products in the existence of clearance markets. It is assumed that the expected regular season demand is a linear decreasing function of the price and the end of period excess inventory is sold at a known discounted price in a clearance market where the demand is a random variable that follows a general distribution. It is shown that the expected profit function is unimodal and the optimal procurement quantity and price can be found from the first order conditions. Existence of a clearance market increases the profit, price, and the procurement quantity. In order to prove this, the optimal procurement and pricing policy of a price-setting retailer who does not have a clearance market is provided. As opposed to the literature, it is shown that the expected profit function of this problem is unimodal as well. A numerical study demonstrating the magnitude of the increase in profit, procurement quantity, and price is reported.     

Telecommunications companies: One meeting with any competitor is enough to violate the EU's competition laws and result in fines

This commentary's purpose is to review how Telfort, T-Mobile, Vodafone, and others discovered that one “meeting” of any type with any telecommunications competitor could result in fines up to 10 percent of total “turnover” under EU competition law Regulation no. 1/2003, Article 23(2)(a), and to provide planning tips on how to eliminate the potential for those adverse consequences. While competition laws do not apply solely to the telecommunications industry, they do seem to affect it disproportionately. Telecommunications companies have global reach, and some of the most stringent competition law exists in Europe. Thus, all should review the most recent telecommunications ruling from the European Court of Justice, T-Mobile Netherlands BV v. Raad van bestuur van der Nederlandse Mededingingsautoriteit C-8/08 (2009). ¹ The ruling deals with whether the one meeting was “concerted activity” in violation of Article 81(1) EC.     

Financial and operational decisions in the electricity sector: Contract portfolio optimization with the conditional value-at-risk criterion

The restructuring of electricity markets around the world have caused increased volatility and uncertainty of the price power. As a result, providers of power now face increased uncertainty and risk in the operational and financial decisions related to procurement. Providers must seek optimal ways to deliver the required volume of power to retailers and end users while managing risk. We consider a mixed-integer programming model for a power providing agent that jointly considers the problem of selecting custom electricity contracts and finding the optimal procurement strategy of meeting contract obligations under spot price uncertainty. A two-stage stochastic integer programming (SIP) model with a conditional value-at-risk (CVaR) constraint to incorporate risk aversion is developed. Computational results are presented that demonstrates the CVaR approach and the results are compared with a corresponding expected cost minimization approach. The SIP model with CVaR will allow acceptance of contracts at lower prices compared to an approach based on a corresponding risk-neutral model as a hedge against uncertainty and mis-specified arbitrage.     

电力体制改革中电网企业财务关系及其处理

分析了电力体制改革中电网企业财务关系出现的新格局,并提出电网企业处理财务关系的三大目标,用现代企业管理理念,重点处理好当前电网企业七个主要方面的财务关系。