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Fixed-mobile integration

Author

Listed:
  • Steffen Hoernig
  • Marc Bourreau

    (SES - Département Sciences Economiques et Sociales - Télécom Paris - IMT - Institut Mines-Télécom [Paris] - IP Paris - Institut Polytechnique de Paris, ECOGE - Economie Gestion - I3 SES - Institut interdisciplinaire de l’innovation de Telecom Paris - Télécom Paris - IMT - Institut Mines-Télécom [Paris] - IP Paris - Institut Polytechnique de Paris - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique)

  • Carlo Cambini

    (Polito - Politecnico di Torino = Polytechnic of Turin)

Abstract

Fixed-line incumbents often also own the largest mobile network. We consider the effect of this joint ownership on market outcomes. Our model predicts that while fixed-to-mobile call prices to the integrated mobile network are more efficient than under separation, those to rival mobile networks are distorted upwards, amplifying any incumbency advantage. This result is robust to changes in the competitiveness of the fixed market and to the presence of fixed-mobile substitution. As concerns potential remedies, a uniform off-net pricing constraint leads to higher welfare than functional separation, and even allows to maintain some of the efficiency gains. Copyright Springer Science+Business Media New York 2014
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Steffen Hoernig & Marc Bourreau & Carlo Cambini, 2014. "Fixed-mobile integration," Post-Print hal-02085292, HAL.
    • Handle: RePEc:hal:journl:hal-02085292
    DOI: 10.1007/s11149-013-9230-y
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    Cited by:

    1. Vogelsang Ingo, 2013. "The Endgame of Telecommunications Policy? A Survey," Review of Economics, De Gruyter, vol. 64(3), pages 193-270, December.
    2. Moshi, Goodiel Charles & Mwakatumbula, Hilda Jacob, 2017. "Effects of political stability and sector regulations on investments in African mobile markets," Telecommunications Policy, Elsevier, vol. 41(7), pages 651-661.
    3. Moshi, Goodiel & Mitomo, Hitoshi, 2014. "Political stability, regulation and investment in the African mobile markets," 25th European Regional ITS Conference, Brussels 2014 101430, International Telecommunications Society (ITS).
    4. Muck, Johannes, 2016. "Tariff-mediated network effects with incompletely informed consumers," DICE Discussion Papers 210, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    5. Hoernig, Steffen & Bourreau, Marc & Cambini, Carlo, 2015. "Fixed-mobile substitution and termination rates," Telecommunications Policy, Elsevier, vol. 39(1), pages 65-76.

    More about this item

    JEL classification:

    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation

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