IDEAS home Printed from https://ideas.repec.org/a/eee/telpol/v38y2014i4p393-405.html
   My bibliography  Save this article

The stalemate of cable digital switchover: A study of competition effects and deregulation

Author

Listed:
  • Chou, Yuntsai

Abstract

This paper addresses the phenomenon of delayed cable digitization in Taiwan and reports the results of a longitudinal analysis, determining that (1) inter-platform competition, primarily from internet protocol television (IPTV), generates a strong and positive impact on the digitization of cable service after it acquires numerous customers; (2) the installed cable base induces economies of scale that increase its digital penetration; (3) the overbuild of the equivalent-size rivalry can increase digital adoption, whereas unequal-sized competition might reversely decrease it; and (4) the monthly flat fee charged to customers does not influence digital adoption. In addition, this paper presents a discussion on the policy instruments derived from econometric results. Although repealing the horizontal integration cap in the cable TV industry could generate economies of scale, doing so may encourage monopolization over several franchises. The efficacy of intra-platform competition is reserved only for certain cases. Combining the results of these analyses reveals that inter-platform competition most effectively stimulates cable operators’ digital conversion. Hence, regulators should create a level playing field among various TV platforms, such as equal programming access and open standards, to ensure a high degree of cable digitization

Suggested Citation

  • Chou, Yuntsai, 2014. "The stalemate of cable digital switchover: A study of competition effects and deregulation," Telecommunications Policy, Elsevier, vol. 38(4), pages 393-405.
    • Handle: RePEc:eee:telpol:v:38:y:2014:i:4:p:393-405
    DOI: 10.1016/j.telpol.2014.01.001
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0308596114000020
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.telpol.2014.01.001?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Sung, Nakil, 2011. "Competitive rivalry, inter-modal competition and market performance in the Korean cable television markets: An empirical analysis," Telecommunications Policy, Elsevier, vol. 35(6), pages 483-493, July.
    2. Agyei Karikari, John & Brown, Stephen M. & Abramowitz, Amy D., 2003. "Subscriptions for direct broadcast satellite and cable television in the US: an empirical analysis," Information Economics and Policy, Elsevier, vol. 15(1), pages 1-15, March.
    3. Chenghuan Sean Chu, 2008. "The effect of satellite entry on product quality for cable television," Finance and Economics Discussion Series 2008-12, Board of Governors of the Federal Reserve System (U.S.).
    4. Myung-Hyun Kang, 2002. "Digital Cable: Exploring Factors Associated With Early Adoption," Journal of Media Economics, Taylor & Francis Journals, vol. 15(3), pages 193-207.
    5. Jérôme Adda & Marco Ottaviani & Paul Seabright, 2005. "The transition to digital television [‘Balladurette and Juppette: A discrete analysis of scrapping subsidies’]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 20(41), pages 160-209.
    6. Gregory S. Crawford, 2000. "The Impact of the 1992 Cable Act on Household Demand and Welfare," RAND Journal of Economics, The RAND Corporation, vol. 31(3), pages 422-450, Autumn.
    7. Liebowitz, S J & Margolis, Stephen E, 1995. "Path Dependence, Lock-in, and History," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 11(1), pages 205-226, April.
    8. Crawford, Gregory S & Shum, Matthew, 2007. "Monopoly Quality Degradation and Regulation in Cable Television," Journal of Law and Economics, University of Chicago Press, vol. 50(1), pages 181-219, February.
    9. Austan Goolsbee & Amil Petrin, 2004. "The Consumer Gains from Direct Broadcast Satellites and the Competition with Cable TV," Econometrica, Econometric Society, vol. 72(2), pages 351-381, March.
    10. Scott Savage & Michael Wirth, 2005. "Price, Programming and Potential Competition in US Cable Television Markets," Journal of Regulatory Economics, Springer, vol. 27(1), pages 25-46, September.
    11. Gregory Crawford, 2008. "The discriminatory incentives to bundle in the cable television industry," Quantitative Marketing and Economics (QME), Springer, vol. 6(1), pages 41-78, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Liu, Chorng-Jian & Chuang, Yi-Fei, 2015. "From Sluggish to Brisk: An analysis of Taiwan׳s cable TV digitalization policy," Telecommunications Policy, Elsevier, vol. 39(11), pages 980-995.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Liu, Chorng-Jian & Chuang, Yi-Fei, 2015. "From Sluggish to Brisk: An analysis of Taiwan׳s cable TV digitalization policy," Telecommunications Policy, Elsevier, vol. 39(11), pages 980-995.
    2. Sutirtha Bagchi & Jagadeesh Sivadasan, 2017. "Barriers to Entry and Competitive Behavior: Evidence from Reforms of Cable Franchising Regulations," Journal of Industrial Economics, Wiley Blackwell, vol. 65(3), pages 510-558, September.
    3. Gregory S. Crawford & Oleksandr Shcherbakov & Matthew Shum, 2015. "The welfare effects of endogenous quality choice in cable television markets," ECON - Working Papers 202, Department of Economics - University of Zurich.
    4. Crawford, Gregory & Shcherbakov, Oleksandr & Shum, Matthew, 2015. "The Welfare E ects of Endogenous Quality Choice in Cable Television Markets," CEPR Discussion Papers 10793, C.E.P.R. Discussion Papers.
    5. Mary T Kelly & John S Ying, 2014. "Testing the Effectiveness of Regulation and Competition on Cable Television Rates," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 40(3), pages 387-404, June.
    6. Gregory S. Crawford & Ali Yurukoglu, 2012. "The Welfare Effects of Bundling in Multichannel Television Markets," American Economic Review, American Economic Association, vol. 102(2), pages 643-685, April.
    7. David P. Byrne, 2015. "Testing Models Of Differentiated Products Markets: Consolidation In The Cable Tv Industry," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 56(3), pages 805-850, August.
    8. Chenghuan Sean Chu, 2008. "The effect of satellite entry on product quality for cable television," Finance and Economics Discussion Series 2008-12, Board of Governors of the Federal Reserve System (U.S.).
    9. Robert C. Seamans, 2012. "Fighting City Hall: Entry Deterrence and Technology Upgrades in Cable TV Markets," Management Science, INFORMS, vol. 58(3), pages 461-475, March.
    10. Victor Ginsburgh & Israel Zang, 2007. "Bundling by Competitors and the Sharing of Profits," Economics Bulletin, AccessEcon, vol. 12(16), pages 1-9.
    11. Gregory S. Crawford, 2015. "The economics of television and online video markets," ECON - Working Papers 197, Department of Economics - University of Zurich.
    12. Anja Lambrecht & Katja Seim & Naufel Vilcassim & Amar Cheema & Yuxin Chen & Gregory Crawford & Kartik Hosanagar & Raghuram Iyengar & Oded Koenigsberg & Robin Lee & Eugenio Miravete & Ozge Sahin, 2012. "Price discrimination in service industries," Marketing Letters, Springer, vol. 23(2), pages 423-438, June.
    13. Kim Kyoo il & Petrin Amil, 2015. "Tests for Price Endogeneity in Differentiated Product Models," Journal of Econometric Methods, De Gruyter, vol. 4(1), pages 1-23, January.
    14. T. Randolph Beard & Jeffrey T. Macher & John W. Mayo, 2015. "'Can you Hear Me Now?' Exit, Voice and Loyalty Under Increasing Competition," Journal of Law and Economics, University of Chicago Press, vol. 58(3).
    15. Chenghuan Sean Chu, 2010. "The effect of satellite entry on cable television prices and product quality," RAND Journal of Economics, RAND Corporation, vol. 41(4), pages 730-764, December.
    16. Crawford, Gregory, 2015. "The Economics of Television and Online Video Markets," CEPR Discussion Papers 10676, C.E.P.R. Discussion Papers.
    17. Matthew Gentzkow, 2007. "Valuing New Goods in a Model with Complementarity: Online Newspapers," American Economic Review, American Economic Association, vol. 97(3), pages 713-744, June.
    18. Lurkin, Virginie & Garrow, Laurie A. & Higgins, Matthew J. & Newman, Jeffrey P. & Schyns, Michael, 2017. "Accounting for price endogeneity in airline itinerary choice models: An application to Continental U.S. markets," Transportation Research Part A: Policy and Practice, Elsevier, vol. 100(C), pages 228-246.
    19. Nishida, Mitsukuni & Gil, Ricard, 2014. "Regulation, enforcement, and entry: Evidence from the Spanish local TV industry," International Journal of Industrial Organization, Elsevier, vol. 32(C), pages 11-23.
    20. Francesco Lamperti & Giovanni Dosi & Mauro Napoletano & Andrea Roventini & Alessandro Sapio, 2018. "And then he wasn't a she : Climate change and green transitions in an agent-based integrated assessment model," Working Papers hal-03443464, HAL.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:telpol:v:38:y:2014:i:4:p:393-405. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/30471/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.