‘How Different is Wireless Access? Implications for Internet Mergers

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‘How Different is Wireless Access? Implications for Internet Mergers

Author Info

Giovannetti, E.

Additional information is available for the following registered author(s):

Emanuele Giovannetti

Abstract

Network 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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Paper provided by Faculty of Economics, University of Cambridge in its series Cambridge Working Papers in Economics with number 0307.

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Length: 24
Date of creation: Jan 2003
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Handle: RePEc:cam:camdae:0307

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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)

References listed on IDEAS
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.:

Jean-Jacques Laffont & Jean Tirole, 2001. "Competition in Telecommunications," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262621509.
Nicholas S. Economides & Glenn A. Woroch, 1992. "Benefits and Pitfalls of Network Interconnection," Working Papers 92-31, New York University, Leonard N. Stern School of Business, Department of Economics.
Other versions:
- Nicholas S. Economides & Glenn A. Woroch, 1994. "Benefits and Pitfalls of Network Interconnection," Industrial Organization 9411005, EconWPA. [Downloadable!]
Jean-Jacques Laffont & Patrick Rey & Jean Tirole, 1998. "Network Competition: I. Overview and Nondiscriminatory Pricing," RAND Journal of Economics, The RAND Corporation, vol. 29(1), pages 1-37, Spring. [Downloadable!] (restricted)
Armstrong, Mark & Doyle, Chris & Vickers, John, 1996. "The Access Pricing Problem: A Synthesis," Journal of Industrial Economics, Blackwell Publishing, vol. 44(2), pages 131-50, June. [Downloadable!] (restricted)
Other versions:
- Armstrong, M. & Doyle, C. & Vickers, J., 1995. "The Access Pricing Problem: A Synthesis," Discussion Paper Series In Economics And Econometrics 9532, Economics Division, School of Social Sciences, University of Southampton.
Jeffrey K. MacKie-Mason & Hal R. Varian, 1994. "Pricing the Internet," Computational Economics 9401002, EconWPA. [Downloadable!]
Other versions:
- Mackie-Mason, J.K. & Varian, H.R., 1993. "Pricing the Internet," Memorandum 20/1993, Oslo University, Department of Economics.
Economides, Nicholas, 1998. "The incentive for non-price discrimination by an input monopolist," International Journal of Industrial Organization, Elsevier, vol. 16(3), pages 271-284, May. [Downloadable!] (restricted)
Giovannetti, Emanuele, 2002. "Interconnection, differentiation and bottlenecks in the Internet," Information Economics and Policy, Elsevier, vol. 14(3), pages 385-404, September. [Downloadable!] (restricted)
Other versions:
- Giovannetti, E., 2000. "Interconnection, Differentiation and Bottlenecks in the Internet," Cambridge Working Papers in Economics 0011, Faculty of Economics, University of Cambridge. [Downloadable!]
Armstrong, Mark, 2001. "The theory of access pricing and interconnection," MPRA Paper 15608, University Library of Munich, Germany. [Downloadable!]
Armstrong, Mark, 1998. "Network Interconnection in Telecommunications," Economic Journal, Royal Economic Society, vol. 108(448), pages 545-64, May. [Downloadable!] (restricted)

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Cited by:
(explanations, 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.)

D'Ignazio, A. & Giovannetti, E., 2004. "From Exogenous to Endogenous Networks: Internet Applications," Cambridge Working Papers in Economics 0445, Faculty of Economics, University of Cambridge. [Downloadable!]

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