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Roaming in the Mobile Internet

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Author Info

  • Fabrizi, Simona
  • Wertlen, Bruno

Abstract

With the acquisition of UMTS licenses Mobile Operators (MOs), have often been obliged to deploy 3G network infrastructures covering at least a given percentage of users by a given date. This paper discusses the rationale for imposing these minimum coverage requirements by regulatory bodies. To that end, a model is built, which studies the incentives for MOs to compete for market share and over coverage within an unregulated environment where MOs are assumed to be free to enter sharing agreements and to negotiate a reciprocal roaming charge. Within this framework, it is first shown that MOs would deploy their infrastructure to guarantee the coverage of the entire territory (population), but they would avoid any network duplication in order to maximize rents from roaming revenues. It is then discussed whether a minimum coverage requirement is the best policy to reduce these excess rents, or whether alternative measures could be adopted which could serve other goals as well, such as the avoidance of network duplication.

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Bibliographic Info

Article provided by Elsevier in its journal Telecommunications Policy.

Volume (Year): 32 (2008)
Issue (Month): 1 (February)
Pages: 50-61

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Handle: RePEc:eee:telpol:v:32:y:2008:i:1:p:50-61

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Related research

Keywords: Mobile Internet Coverage Roaming agreements No-duplication Minimum coverage requirement Regulation;

References

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  1. Ken Binmore & Paul Klemperer, 2001. "The Biggest Auction Ever: the Sale of the British 3G Telecom Licenses," Economics Papers 2002-W4, Economics Group, Nuffield College, University of Oxford, revised 01 Sep 2001.
  2. Jean-Jacques Laffont, 2001. "Internet Interconnection and the Off-Net-Cost Pricing Principle," Theory workshop papers 357966000000000085, UCLA Department of Economics.
  3. Paul Klemperer, 2004. "Auctions: Theory and Practice," Economics Papers 2004-W09, Economics Group, Nuffield College, University of Oxford.
  4. Cambini, Carlo & Valletti, Tommaso, 2003. "Investments and Network Competition," CEPR Discussion Papers 3829, C.E.P.R. Discussion Papers.
  5. van Damme, Eric, 2002. "The European UMTS-auctions," European Economic Review, Elsevier, vol. 46(4-5), pages 846-858, May.
  6. Paul Klemperer, 2004. "Introduction to Auctions: Theory and Practice
    [Auctions: Theory and Practice]
    ," Introductory Chapters, Princeton University Press.
  7. Sutherland, Ewan, 2001. "International roaming charges: over-charging and competition law," Telecommunications Policy, Elsevier, vol. 25(1-2), pages 5-20, February.
  8. Joshua S. Gans & Stephen P. King & Julian Wright, 2005. "Wireless Communications," Development Research Unit Working Paper Series archive-45, Monash University, Department of Economics.
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Citations

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Cited by:
  1. Joan Calzada & Francesc Trillas, 2005. "The interconnection prices in telecomunications: from theory to practice," Hacienda Pública Española, IEF, vol. 173(2), pages 85-125, June.
  2. Stühmeier, Torben, 2012. "Roaming and Investments in the Mobile Internet Market," DICE Discussion Papers 46, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
  3. Foros, Øystein & Kind, Hans Jarle & Sand, Jan Yngve, 2009. "Entry may increase network providers' profit," Telecommunications Policy, Elsevier, vol. 33(9), pages 486-494, October.

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