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A Basic Analysis of Entry and Exit in the US Broadband Market, 2005–2008

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  • Connolly Michelle

    (Department of Economics, Duke University, Durham, NC, USA)

  • Prieger James E.

    (School of Public Policy, Pepperdine University, 24255 Pacific Coast Hwy, Malibu, CA 90263-7490, USA)

Abstract

We conduct a basic analysis of entry and exit in the US broadband market, using a complete FCC census of providers from 2005 to 2008. There is a tremendous amount of (simultaneous) entry and exit in the US broadband market. Most entry is from existing providers expanding into new geographic areas. Entry and exit vary widely across the various modes of provision, which argues against treating broadband as a homogenous service in theoretical or empirical work. The highest entry rates also generally have the highest entrant shares. Entry rates display positive autocorrelation, and the same is true for exit. There is also positive correlation between the entry and exit rates at various leads and lags, suggesting that there are systematic differences among the broadband types in the height of entry and exit barriers. We discuss some implications these results may have for both policy purposes and future work in the broadband market.

Suggested Citation

  • Connolly Michelle & Prieger James E., 2013. "A Basic Analysis of Entry and Exit in the US Broadband Market, 2005–2008," Review of Network Economics, De Gruyter, vol. 12(3), pages 229-270, September.
    • Handle: RePEc:bpj:rneart:v:12:y:2013:i:3:p:229-270:n:3
    DOI: 10.1515/rne-2013-0001
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    2. Shane Greenstein, 2020. "Digital Infrastructure," NBER Chapters, in: Economic Analysis and Infrastructure Investment, pages 409-447, National Bureau of Economic Research, Inc.
    3. Mack, Elizabeth A. & Helderop, Edward & Keene, Thomas & Loveridge, Scott & Mann, John & Grubesic, Tony H. & Kowalkowski, Brian & Gollnow, Miranda, 2022. "A longitudinal analysis of broadband provision in tribal areas," Telecommunications Policy, Elsevier, vol. 46(5).
    4. Njoroge Paul & Ozdaglar Asuman & Stier-Moses Nicolás E. & Weintraub Gabriel Y., 2014. "Investment in Two-Sided Markets and the Net Neutrality Debate," Review of Network Economics, De Gruyter, vol. 12(4), pages 355-402, February.

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