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Competition in a Pure World of Internet Telephony

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Author Info
Christoph Engel () (Max Planck Institute for Research on Collective Goods, Bonn)

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Abstract

From the angle of competition policy, Voice over IP looks like a panacea. It not only brings better service, but it also increases competitive pressure on former telecommunications monopolists. This paper points to the largely overlooked downside. In a pure world of Internet telephony, there would be no charge for individual calls, nor for telephony, as distinct from other services running over the uniform network. Specifically, establishing property rights for either of these would be costly, whereas these property rights were automatic and free of charge in switched telephony. Giving voice over IP providers classic telephone numbers would enhance systems competition with switched telephony. But this would make it more difficult for clients to swap providers. The anti-competitive caller pays principle would extend to IP telephony.

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Publisher Info
Paper provided by Max Planck Institute for Research on Collective Goods in its series Working Paper Series of the Max Planck Institute for Research on Collective Goods with number 2007_1.

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Length: 19 pages
Date of creation: Jan 2007
Date of revision:
Handle: RePEc:mpg:wpaper:2007_1

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Related research
Keywords: property right non-linear pricing pure bundling club good cross-subsidisation packet switched telephony

Find related papers by JEL classification:
D - Microeconomics
D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
L43 - Industrial Organization - - Antitrust Issues and Policies - - - Legal Monopolies and Regulation or Deregulation
L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

This paper has been announced in the following NEP Reports:

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.:
  1. Hanming Fang & Peter Norman, 2008. "Optimal Provision of Multiple Excludable Public Goods," NBER Working Papers 13797, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  2. Beggs, Alan & Klemperer, Paul, 1990. "Multi-Period Competition with Switching Costs," CEPR Discussion Papers 436, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  3. Hanming Fang & Peter Norman, 2003. "To Bundle or Not to Bundle," Cowles Foundation Discussion Papers 1440, Cowles Foundation, Yale University. [Downloadable!]
    Other versions:
  4. Scotchmer, Suzanne & Wooders, Myrna Holtz, 1987. "Competitive equilibrium and the core in club economies with anonymous crowding," Journal of Public Economics, Elsevier, vol. 34(2), pages 159-173, November. [Downloadable!] (restricted)
  5. Benjamin E. Hermalin & Michael L. Katz, 2004. "Sender or Receiver: Who Should Pay to Exchange an Electronic Message?," RAND Journal of Economics, The RAND Corporation, vol. 35(3), pages 423-447, Autumn.
  6. Doyle, Chris & Smith, Jennifer C., 1998. "Market structure in mobile telecoms: qualified indirect access and the receiver pays principle," Information Economics and Policy, Elsevier, vol. 10(4), pages 471-488, December. [Downloadable!] (restricted)
  7. Paul A. David, 2001. "The Evolving Accidental Information Super-Highway," Oxford Review of Economic Policy, Oxford University Press, vol. 17(2), pages 159-187, Summer.
  8. Robert W. Helsley & William C. Strange, 1991. "Exclusion and the Theory of Clubs," Canadian Journal of Economics, Canadian Economics Association, vol. 24(4), pages 889-99, November.
  9. Crew, Michael A & Fernando, Chitru S & Kleindorfer, Paul R, 1995. "The Theory of Peak-Load Pricing: A Survey," Journal of Regulatory Economics, Springer, vol. 8(3), pages 215-48, November.
  10. Jeffrey K. MacKie-Mason & Hal R. Varian, 1994. "Pricing the Internet," Computational Economics 9401002, EconWPA. [Downloadable!]
    Other versions:
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