Roaming in the Mobile Internet: when coverage sharing agreements call for regulation

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Roaming in the Mobile Internet: when coverage sharing agreements call for regulation

Author Info

Simona Fabrizi () (The University of the Basque Country)
Bruno Wertlen () (Charles University, and Contactel, Prague.)

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Abstract

We examine competition in Mobile Internet services, when operators bargain over the coverage sharing and their reciprocal roaming charge. Results show that in equilibrium operators cover the overall territory entirely and no-duplication is chosen, no matter how their bargaining power is distributed: operators have aligned incentives to enjoy roaming revenues extra-rents. Only their relative stand-alone coverage and, therefore, their appropriation of these rents, can be affected by how bargaining power is distributed. We finally discuss the scope for regulatory intervention to reduce these rents in the forms of minimum coverage requirements, or control over the level of reciprocal roaming charges.

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Paper provided by University of the Basque Country - Department of Foundations of Economic Analysis II in its series DFAEII Working Papers with number 200309.

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Date of creation: 28 Jun 2003
Date of revision: 28 Jun 2006
Handle: RePEc:ehu:dfaeii:200309

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Postal: Dpto. de Fundamentos del Análisis Económico II, Facultad de CC. Económicas y Empresariales, Universidad del País Vasco, Avda. Lehendakari Aguirre 83, 48015 Bilbao, Spain
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Find related papers by JEL classification:
D4 - Microeconomics - - Market Structure and Pricing
L5 - Industrial Organization - - Regulation and Industrial Policy
L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

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.:

LAFFONT, Jean-Jacques & MARCUS, Scott & REY, Patrick & TIROLE, Jean, 2001. "Internet Interconnection and the Off-Net-Cost Pricing Principle," IDEI Working Papers 130, Institut d'Économie Industrielle (IDEI), Toulouse. [Downloadable!]
Other versions:
- Jean-Jacques Laffont, 2001. "Internet Interconnection and the Off-Net-Cost Pricing Principle," Theory workshop papers 357966000000000085, UCLA Department of Economics. [Downloadable!]
- Laffont, Jean-Jacques, et al, 2003. " Internet Interconnection and the Off-Net-Cost Pricing Principle," RAND Journal of Economics, The RAND Corporation, vol. 34(2), pages 370-90, Summer.
Binmore, Kenneth & Klemperer, Paul, 2002. "The Biggest Auction Ever: The Sale of the British 3G Telecom Licences," CEPR Discussion Papers 3214, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
Other versions:
- 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. [Downloadable!]
- Ken Binmore & Paul Klemperer, 2002. "The Biggest Auction Ever: the Sale of the British 3G Telecom Licences," Economic Journal, Royal Economic Society, vol. 112(478), pages C74-C96, March. [Downloadable!] (restricted)

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