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Vertical Foreclosure in Broadband Access?

Author

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  • Daniel L. Rubinfeld
  • Hal J. Singer

Abstract

The merger of AOL and Time Warner involved a vertical combination of the largest Internet content provider and aggregator and a large cable system operator which offers a conduit through which broadband customers can access Internet content at high speeds. We consider the economic incentives of such a firm to engage in two distinct vertical foreclosure strategies: (1) conduit discrimination—insulating its own conduit from competition by limiting rival platform distribution of its affiliated content and services, and (2) content discrimination—insulating its own affiliated content from competition by blocking or degrading the quality of outside content.

Suggested Citation

  • Daniel L. Rubinfeld & Hal J. Singer, 2001. "Vertical Foreclosure in Broadband Access?," Journal of Industrial Economics, Wiley Blackwell, vol. 49(3), pages 299-318, September.
    • Handle: RePEc:bla:jindec:v:49:y:2001:i:3:p:299-318
    DOI: 10.1111/1467-6451.00151
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    Citations

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    Cited by:

    1. Robert Hahn & Robert Litan & Hal Singer, 2010. "Addressing the next wave of Internet regulation: Toward a workable principle for nondiscrimination," Regulation & Governance, John Wiley & Sons, vol. 4(3), pages 365-382, September.
    2. Gregory L. Rosston, 2006. "The Rise and Fall of Third-party High-speed Access," Discussion Papers 05-019, Stanford Institute for Economic Policy Research.
    3. Daeho Lee & Junseok Hwang, 2011. "The Effect of Network Neutrality on the Incentive to Discriminate, Invest and Innovate: A Literature Review," TEMEP Discussion Papers 201184, Seoul National University; Technology Management, Economics, and Policy Program (TEMEP), revised Nov 2011.
    4. Christiaan Hogendorn, 2007. "Broadband Internet: net neutrality versus open access," International Economics and Economic Policy, Springer, vol. 4(2), pages 185-208, August.
    5. Rosston, Gregory L., 2009. "The rise and fall of third-party high-speed access," Information Economics and Policy, Elsevier, vol. 21(1), pages 21-33, February.
    6. D. Lanzi & M. Marzo, 2004. "Content Delivery and Vertical Integration in O-L Content Markets," Working Papers 513, Dipartimento Scienze Economiche, Universita' di Bologna.
    7. Zava Aydemir & Stefan Buehler, 2002. "Estimating Vertical Foreclosure in U.S. Gasoline Supply," SOI - Working Papers 0212, Socioeconomic Institute - University of Zurich.
    8. Paul J.J Welfens, 2010. "Toward a New Concept of Universal Services: The Role of Digital Mobile Services and Network Neutrality," EIIW Discussion paper disbei177, Universitätsbibliothek Wuppertal, University Library.
    9. Hervas-Drane, Andres, 2011. "Non-cost-raising discrimination: A rationale for functional separation in broadband open access," IESE Research Papers D/942, IESE Business School.
    10. Crawford, Gregory, 2015. "The Economics of Television and Online Video Markets," CEPR Discussion Papers 10676, C.E.P.R. Discussion Papers.
    11. Christiaan Hogendorn, 2004. "Broadband Internet: Open Access and Content Competition," Wesleyan Economics Working Papers 2004-002, Wesleyan University, Department of Economics.
    12. Gregory S. Crawford, 2015. "The economics of television and online video markets," ECON - Working Papers 197, Department of Economics - University of Zurich.
    13. Foros, Oystein, 2004. "Strategic investments with spillovers, vertical integration and foreclosure in the broadband access market," International Journal of Industrial Organization, Elsevier, vol. 22(1), pages 1-24, January.
    14. Foros, Oystein & Jarle Kind, Hans & Yngve Sand, Jan, 2005. "Do internet incumbents choose low interconnection quality?," Information Economics and Policy, Elsevier, vol. 17(2), pages 149-164, March.

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