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Are mobile and fixed broadband substitutes or complements? New empirical evidence from Italy and implications for the digital divide policies

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  • Quaglione, Davide
  • Matteucci, Nicola
  • Furia, Donatella
  • Marra, Alessandro
  • Pozzi, Cesare

Abstract

The literature on broadband policies has been focusing on the possible role of mobile broadband as a means for addressing geographical digital divide in areas with no or inadequate fixed broadband infrastructure coverage. Broadband plans designed by most of the industrialized countries take the substitutability between fixed and mobile technologies for granted, with restrictions essentially relating only to bandwidth performance. We explore the determinants of individuals' private access (away from work) to the Internet with the smartphone through a mobile broadband connection, focusing on the role played by Internet uses and taking into account the availability of a fixed broadband connection at home. The results of our econometric exercise, carried out on microdata referred to Italian individuals, provide original and interesting evidence: a complementarity effect between mobile and fixed broadband is found for browsing, video streaming, gaming and cloud services; a substitution effect emerges for social networking and music streaming. Such increasing complexity of individuals’ broadband usage patterns should be acknowledged in the way broadband coverage is mapped and policies designed, adopting a more ecosystem-oriented approach which integrates supply- and demand-side features. A first step in this direction is the inclusion of some, so far neglected, key-attributes of the demand (data traffic allowance, latency, ease of interconnection with Internet capable devices) among the relevant dimensions of policy design.

Suggested Citation

  • Quaglione, Davide & Matteucci, Nicola & Furia, Donatella & Marra, Alessandro & Pozzi, Cesare, 2020. "Are mobile and fixed broadband substitutes or complements? New empirical evidence from Italy and implications for the digital divide policies," Socio-Economic Planning Sciences, Elsevier, vol. 71(C).
    • Handle: RePEc:eee:soceps:v:71:y:2020:i:c:s0038012119301016
    DOI: 10.1016/j.seps.2020.100823
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    2. Pludow, B. Amelia & Murray, Alan T. & Church, Richard L., 2022. "Service quality modeling to support optimizing facility location in a microscale environment," Socio-Economic Planning Sciences, Elsevier, vol. 82(PB).
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    More about this item

    Keywords

    Mobile broadband adoption; Determinants; Fixed-mobile substitution; Italy; Digital divide policies; Evidence-based policy-making;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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