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On the (In) Effectiveness of Policies to Promote Broadband Diffusion in Europe (2003-2010): An Econometric Assessment

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  • Michele Cincera
  • Antonio Estache
  • Lauriane Dewulf

Abstract

This paper presents an updated empirical assessment of the relative effectiveness of intra-platform and inter-platform competition in terms of broadband diffusion in Europe between 2003 and 2010. It relies on an econometric analysis of 18 European countries. To approximate two forms of competition within a same platform, we distinguish between service-based access and facility-based access. The first type requires less investment from entrants than the second which allows entrants to differentiate their product. Our results update and validate earlier studies. We show that service-based intra-platform competition brought by access regulation is still not an accelerating factor of broadband diffusion (or investment) in Europe. In contrast, we find that both facility-based intra-platform competition brought by access regulation and inter-platform competition brought by the deployment of non-DSL technologies effectively fuels broadband diffusion. In sum, many EU countries may have underestimated the potential payoff of stimulating product differentiation through inter-platform and service-based intra-platform competition for the diffusion of broadband in Europe.

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Bibliographic Info

Paper provided by ULB -- Universite Libre de Bruxelles in its series Working Papers ECARES with number ECARES 2012-032.

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Length: 17 p.
Date of creation: Sep 2012
Date of revision:
Publication status: Published by:
Handle: RePEc:eca:wpaper:2013/128909

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Keywords: ICT; broadband diffusion; competition;

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Cited by:
  1. Calzada, Joan & Martínez, Fernando, 2012. "Broadband prices in the European Union: Competition and commercial strategies," 23rd European Regional ITS Conference, Vienna 2012 60382, International Telecommunications Society (ITS).

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