Level of Access and Competition in Broadband Markets
AbstractIn this paper, we consider an unregulated incumbent who owns a broadband infrastructure and decides on how much access to provide to a potential entrant. The level of access, i.e., the network elements that are shared in the provision of competing broadband services, not only determines the amount of investment the entrant needs to undertake to enter the market, but also the intensity of post-entry competition. We consider an access scheme that determines an access level and an associated two-part tariff. We show that the equilibrium level of access is higher when the sensitivity of product differentiation to the level of access is lower, and when the marginal investment cost is higher. We also show that the unregulated incumbent sets a suboptimally low (high) level of access if the degree of service differentiation is sufficiently high (low).
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Bibliographic InfoPaper provided by Harvard Kennedy School of Government in its series Scholarly Articles with number 4454152.
Date of creation: 2010
Date of revision:
Publication status: Published in HKS Faculty Research Working Paper Series
Other versions of this item:
- Bourreau Marc & Dogan Pinar, 2012. "Level of Access and Competition in Broadband Markets," Review of Network Economics, De Gruyter, vol. 11(1), pages 1-33, March.
- Bourreau, Marc & Dogan, Pinar, 2010. "Level of Access and Competition in Broadband Markets," Working Paper Series rwp10-006, Harvard University, John F. Kennedy School of Government.
- M. Bourreau & P. Dogan, . "Level of Access and Competition in Broadband Markets," Working Paper 33656, Harvard University OpenScholar.
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