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Discrete Choice Analysis of Demand for Broadband in Japan

Author

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  • Takanori Ida

    ()

  • Toshifumi Kuroda

    ()

Abstract

The remarkable development of Japan’s broadband (BB) market has attracted attention worldwide. This paper is one of the first to analyze Japan’s BB demand (including FTTH) using a discrete choice model. Our main conclusions are first, there is a distinction between narrowband (NB) and BB services based on a nested choice structure. Second, considering own-price elasticities of access demand, ADSL is inelastic, but FTTH and CATV are elastic. Third, in ADSL submarkets, low-speed and high-speed ADSL are becoming more elastic. Copyright Springer Science+Business Media, Inc. 2006

Suggested Citation

  • Takanori Ida & Toshifumi Kuroda, 2006. "Discrete Choice Analysis of Demand for Broadband in Japan," Journal of Regulatory Economics, Springer, vol. 29(1), pages 5-22, January.
  • Handle: RePEc:kap:regeco:v:29:y:2006:i:1:p:5-22
    DOI: 10.1007/s11149-005-5124-y
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    File URL: http://hdl.handle.net/10.1007/s11149-005-5124-y
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    References listed on IDEAS

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    1. McFadden, Daniel L., 1984. "Econometric analysis of qualitative response models," Handbook of Econometrics,in: Z. Griliches† & M. D. Intriligator (ed.), Handbook of Econometrics, edition 1, volume 2, chapter 24, pages 1395-1457 Elsevier.
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    Cited by:

    1. Aron Debra J. & Ingraham Allan T., 2012. "The Effects of Legacy Pricing Regulation on Adoption of Broadband Service in the United States," Review of Network Economics, De Gruyter, vol. 11(4), pages 1-38, December.
    2. Kongaut, Chatchai & Bohlin, Erik, 2014. "Unbundling and infrastructure competition for broadband adoption: Implications for NGA regulation," Telecommunications Policy, Elsevier, vol. 38(8), pages 760-770.
    3. Filippo Belloc & Antonio Nicita & Maria Alessandra Rossi, 2011. "The Nature, Timing and Impact of Broadband Policies: a Panel Analysis of 30 OECD Countries," Department of Economics University of Siena 615, Department of Economics, University of Siena.
    4. Jinsoo Bae & Yun Jeong Choi & Jong-Hee Hahn, 2014. "Fixed and mobile broadband; Are they substitutes or complements?," Working papers 2014rwp-68, Yonsei University, Yonsei Economics Research Institute.
    5. Akematsu, Yuji & Abu, Sheikh Taher & Tsuji, Masatsugu, 2010. "Empirical Study of Effect of Deregulation, Competition, and Contents on Mobile Phone Diffusion: Case of the Japanese 3G Market," 21st European Regional ITS Conference, Copenhagen 2010: Telecommunications at new crossroads - Changing value configurations, user roles, and regulation 1, International Telecommunications Society (ITS).
    6. Orhan Dagli & Glenn P. Jenkins, 2015. "Consumer Preferences for Improvements in Mobile Telecommunication Services," Development Discussion Papers 2015-05, JDI Executive Programs.
    7. Srinuan, Chalita & Bohlin, Erik, 2013. "Analysis of fixed broadband access and use in Thailand: Drivers and barriers," Telecommunications Policy, Elsevier, vol. 37(8), pages 615-625.
    8. Arnold, René & Waldburger, Martin & Morasch, Bastian & Schmid, Frieder & Schneider, Anna, 2015. "The value of network neutrality to European consumers," 26th European Regional ITS Conference, Madrid 2015 127121, International Telecommunications Society (ITS).
    9. Meade, Nigel & Islam, Towhidul, 2015. "Forecasting in telecommunications and ICT—A review," International Journal of Forecasting, Elsevier, vol. 31(4), pages 1105-1126.
    10. Yves Schneider & Peter Zweifel, 2013. "Spatial Effects in Willingness to Pay for Avoiding Nuclear Risks," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 149(III), pages 357-379, September.
    11. Pichitkul, Araya & Mitomo, Hitoshi, 2012. "Demand for internet: Empirical comparison between urban and rural subscribers in Thailand," 19th ITS Biennial Conference, Bangkok 2012: Moving Forward with Future Technologies - Opening a Platform for All 72505, International Telecommunications Society (ITS).
    12. Dutz Mark A. & Orszag Jonathan M. & Willig Robert D., 2012. "The Liftoff of Consumer Benefits from the Broadband Revolution," Review of Network Economics, De Gruyter, vol. 11(4), pages 1-34, December.
    13. Filippo Belloc & Antonio Nicita & Maria Alessandra Rossi, 2009. "Whither Broadband Policy? In Search of Selective Intervention," Department of Economics University of Siena 567, Department of Economics, University of Siena.
    14. Goto, Hisanori & Goto, Mika & Sueyoshi, Toshiyuki, 2011. "Consumer choice on ecologically efficient water heaters: Marketing strategy and policy implications in Japan," Energy Economics, Elsevier, vol. 33(2), pages 195-208, March.
    15. Srinuan, Pratompong & Srinuan, Chalita & Bohlin, Erik, 2012. "Fixed and mobile broadband substitution in Sweden," Telecommunications Policy, Elsevier, vol. 36(3), pages 237-251.
    16. Manit Satitsamitpong & Tokio Otsuka & Toshiya Jitsuzumi & Hitoshi Mitomo, 2012. "An Analysis of Demand-based Factors for Broadband Migration," Applied Economics Journal, Kasetsart University, Faculty of Economics, Center for Applied Economic Research, vol. 19(2), pages 1-17, December.
    17. Akematsu, Yuji & Shinohara, Sobee & Tsuji, Masatsugu, 2012. "Factors of FTTH deployment in Japan: A panel data analysis," 23rd European Regional ITS Conference, Vienna 2012 60361, International Telecommunications Society (ITS).
    18. Grzybowski, Lukasz & Nitsche, Rainer & Verboven, Frank & Wiethaus, Lars, 2014. "Market definition for broadband internet in Slovakia – Are fixed and mobile technologies in the same market?," Information Economics and Policy, Elsevier, vol. 28(C), pages 39-56.
    19. Sunada, Mitsuru & Noguchi, Masato & Ohashi, Hiroshi & Okada, Yosuke, 2011. "Coverage area expansion, customer switching, and household profiles in the Japanese broadband access market," Information Economics and Policy, Elsevier, vol. 23(1), pages 12-23, March.
    20. Mélisande Cardona & Anton Schwarz & B. Yurtoglu & Christine Zulehner, 2009. "Demand estimation and market definition for broadband Internet services," Journal of Regulatory Economics, Springer, vol. 35(1), pages 70-95, February.

    More about this item

    Keywords

    broadband; discrete choice; nested logit; price elasticity; L52; L86; L96;

    JEL classification:

    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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