Fixed to VoIP Interconnection: Regulation with Asymmetric Termination Costs
AbstractTypically, incumbent providers enjoy a demand-side advantage over any entrant. However, market entrants may enjoy a supply-side advantage in costs over the incumbent, since they are more efficient or operate on innovative technologies, such as the voice of internet protocol (VoIP) telephony. Regulation with a supply-side asymmetry has rarely been addressed. Considering both a supply-side and a demand- side asymmetry, the present model analyzes the effects different regulation regimes. Regulation may have adverse effects on subscribers, market shares, and profits. If providers can discriminate between on-net and off-net prices, asymmetric regulation has no local effect on market shares, independent of any demand- and supply-side asymmetry. Otherwise, with reciprocal termination charges, price discrimination leads to qualitatively same effects than nondiscriminatory pricing. --
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Bibliographic InfoPaper provided by International Telecommunications Society (ITS) in its series 21st European Regional ITS Conference, Copenhagen 2010: Telecommunications at new crossroads - Changing value configurations, user roles, and regulation with number 34.
Date of creation: 2010
Date of revision:
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Web page: http://www.itseurope.org/
Termination charges; Interconnection; Regulation; Price Discrimination; Voice over Internet Protocol (VoIP);
Find related papers by JEL classification:
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
- L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
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