The Diffusion of Fixed Broadband: An Empirical Analysis
AbstractBroadband infrastructure is a key component of the knowledge economy. Broadband connections on both fixed and mobile networks are becoming an indicator of the knowledge economy. Employing the largest secondary data set, this study examines adoption factors of fixed broadband. The result of nonlinear and linear regression analysis of fixed broadband deployment suggests local loop unbundling (LLU) policy, platform completion between different broadband technologies and other diverse industry, ICT (Information and Communication Technology) and demographic factors influence fixed broadband diffusion. Specifically, the regression analysis of fixed broadband penetration found different types of LLU policies and previous fixed broadband penetration are significant factors of fixed broadband deployment. Some of the significant factors of fixed broadband deployment are different in developed countries than developing countries. This finding suggests, countries fostering broadband deployment need to adopt LLU policy for broadband, but the costs and benefits of the different LLU policy types should be carefully considered. Interestingly, the result of nonlinear regressions of fixed-broadband penetration suggest high levels of platform competition are related to high levels of fixed-broadband penetration, but the effects of platform competition are not statistically significant in OECD countries. This outcome is consistent with the result of linear regression analysis of developed countries (high income ITU membership countries). Considering OECD countries are composed of 30 developed countries with comparatively high GDP per capita, this result is robust. Taking into account this study’s results as well as previous empirical studies on fixed broadband deployment, the effects of platform competition are strong in the initial deployment of fixed-broadband, but the effects of platform competition are decreasing when the broadband market size is sufficiently large or the broadband market is mature. Also, as expected, previous fixed- broadband penetration was found to be an influential factor of current fixed-broadband deployment in all ITU membership countries, whether characterized as developed or developing countries. Considering impacts of platform competition in ITU membership countries, currently it appears in many countries that network effects and the effects of platform competition co-exist.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by NET Institute in its series Working Papers with number 08-19.
Length: 45 pages
Date of creation: Sep 2008
Date of revision: Sep 2008
Contact details of provider:
Web page: http://www.NETinst.org/
Broadband diffusion; fixed broadband; platform competition; network effect;
Find related papers by JEL classification:
- O25 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy
- O38 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Government Policy
- O50 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - General
This paper has been announced in the following NEP Reports:
You can help add them by filling out this form.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Nicholas Economides).
If references are entirely missing, you can add them using this form.