Working Paper: CEPR ID: DP8399
Authors: Steffen Hoernig
Abstract: Due to technological convergence, multiple infrastructures can now offer broadband or triple-play services, while the existing access regulation is based on a single essential network. We show that continued asymmetric access regulation of one network does not control sufficiently for market power and benefits the unregulated network, and that symmetric regulation would lead to higher consumer surplus. Furthermore, the whole setup of access regulation may not be viable in the long run if regulatory constraints provide strong first-mover advantages to the unregulated network.
Keywords: access regulation; cable; convergence; copper
JEL Codes: L51; L96
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| asymmetric regulation (L59) | market power (L11) |
| asymmetric regulation (L59) | consumer surplus (D46) |
| symmetric regulation (L50) | consumer surplus (D46) |
| symmetric regulation (L50) | competition among networks (D85) |
| competition among networks (D85) | consumer surplus (D46) |
| asymmetric regulation (L59) | retail pricing freedom (D49) |
| retail pricing freedom (D49) | equilibrium prices (D41) |
| equilibrium prices (D41) | consumer surplus (D46) |
| regulatory constraints (L51) | first-mover advantages for unregulated network (D85) |
| first-mover advantages for unregulated network (D85) | exit of access seekers (D16) |
| exit of access seekers (D16) | viability of access regulation (L43) |