Access pricing: A comparison between full deregulation and two alternative instruments of access price regulation,cost-based and retail-minus

In this paper, two instruments of access price regulation, cost-based and retail-minus, are compared with the full deregulation hypothesis. For this purpose, a model that considers an upstream monopolist firm that sells a vital input to an independent firm and to a subsidiary firm in the downstream market is developed. The main conclusion of the paper is that retail-minus regulation avoids foreclosure and leads to better results than cost-based regulation in terms of investment level and consumer surplus. Moreover, retail-minus regulation allows a higher consumer surplus than deregulation of access price as long as the regulator carefully defines the retail-minus instrument.     

Cost allocation of WCDMA and wholesale pricing for mVoIP and data services

This study estimates cost-based prices for wholesale voice and data services provided to 3G (WCDMA) MVNOs according to their distinct types. For estimation, 3G MVNOs are classified into different types, and the overall cost of WCDMA facilities are separated into voice and data components based on their subscriber rates, actual traffic rates, as well as efficiency consideration of traffic rates. The study then calculates cost-based wholesale prices of voice and data services for each of the 3G MVNO types. The result of this study shows that a cost-plus pricing scheme can help achieve the policy goals of the regulator, namely, lowering telecommunications tariffs and facilitating the introduction of new convergent-type services, far more effectively than the current retail-minus pricing scheme. The findings of this study may assist firms in developing business models based on 3G networks and telecom regulators in designing policies related to interconnection, mVoIP, prepaid calls, wholesale services, and network neutrality.