The Market Structure of Broadband Telecommunications |
| |
Authors: | Gerald R Faulhaber & Christiaan Hogendorn |
| |
Institution: | Professor, Public Policy &Management Department, Wharton School, University of Pennsylvania,;Member of Technical Staff, Bell Laboratories, Lucent Technologies |
| |
Abstract: | The recent growth of the Internet is creating markets for broadband telecommunications networks. In the past, virtually all such 'infrastructure' networks have been subject to government regulation. Two reasons advanced for this market intervention are (i) such networks constitute a natural monopoly, and (ii) to achieve 'universal service', in which all citizens have access to services. In this paper, we develop a model and estimate it using engineering data which tests if these two hypotheses are likely to obtain for broadband networks. We find that oligopolistic competition is likely to emerge for demand levels approaching that of today's cable television. |
| |
Keywords: | |
|
|