‘How Different is Wireless Access? Implications for Internet Mergers
AbstractNetwork hierarchies in the Internet are often not fixed: two providers can be simultaneously input supplier and retailer in a routing process, while being horizontally competing in another. We introduce a stylised network model capturing these aspects of the Internet to study the impact of differentiation introduced by wireless access on prices and profits. We then study the incentives for, and welfare impact of, a merger between the wireless provider and a local bottleneck fixed access one. These effects crucially depend on the degree of differentiation between the wireless and fixed Internet access modalities. Pricing, at each router, follows the motorway toll metaphor.
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Bibliographic InfoPaper provided by Faculty of Economics, University of Cambridge in its series Cambridge Working Papers in Economics with number 0307.
Date of creation: Jan 2003
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Web page: http://www.econ.cam.ac.uk/index.htm
mergers; internet; network industries; wireless access;
Find related papers by JEL classification:
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
- L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-02-03 (All new papers)
- NEP-COM-2003-02-03 (Industrial Competition)
- NEP-IND-2003-02-03 (Industrial Organization)
- NEP-NET-2003-02-03 (Network Economics)
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