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Access regulation and geographic deployment of a new generation infrastructure

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  • Flacher, David
  • Jennequin, Hugues

Abstract

This paper addresses the impact of regulatory policy on levels of infrastructure deployment and derived welfare in the telecommunications sector. The model considers two potentially coexisting and partially competing technologies (the “old generation network” – OGN – and the “new” generation network – NGN). This framework allows us to show that the “regulation defining access charge in order to maximize infrastructure deployment” is strictly equivalent to the case in which “no regulation applies”. We also derive from the model that these two types of regulation induce higher social welfare, but lower numbers of NGN consumers, compared to the “ex post access prices” regulation. Finally, we show that the level of infrastructure deployment (as well as social welfare and number of NGN consumers) will be highest if both investment and access charge decisions are taken by the welfare maximizing regulator. This suggests that the social optimum will be achieved through a calls-for-tender process that includes deployment and access charge requirements.

Suggested Citation

  • Flacher, David & Jennequin, Hugues, 2014. "Access regulation and geographic deployment of a new generation infrastructure," Telecommunications Policy, Elsevier, vol. 38(8), pages 741-759.
  • Handle: RePEc:eee:telpol:v:38:y:2014:i:8:p:741-759
    DOI: 10.1016/j.telpol.2014.01.005
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    References listed on IDEAS

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    Cited by:

    1. Briglauer Wolfgang & Frübing Stefan & Vogelsang Ingo, 2014. "The Impact of Alternative Public Policies on the Deployment of New Communications Infrastructure – A Survey," Review of Network Economics, De Gruyter, vol. 13(3), pages 227-270, September.
    2. Francisco José García Paramio & Isabel Torre Díez & Beatriz Sainz de Abajo & Miguel López-Coronado Sánchez-Fortún & Joel J. P. C. Rodrigues, 2017. "How does the Spanish regulation of NGN affect to final users? Effects on the deployment of new FTTH infrastructures," Telecommunication Systems: Modelling, Analysis, Design and Management, Springer, vol. 64(2), pages 391-415, February.
    3. Levin, Stanford L. & Schmidt, Stephen, 2015. "Policies to Facilitate FTTP Deployment," 26th European Regional ITS Conference, Madrid 2015 127158, International Telecommunications Society (ITS).
    4. Brito, Duarte & Tselekounis, Markos, 2016. "Access regulation and the entrant's mode of entry under multi-product competition in telecoms," Information Economics and Policy, Elsevier, vol. 37(C), pages 20-33.

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