Quotation Briglauer, Wolfgang. 2015. Facility- and Service-based Competition and Investment in Fixed Broadband Networks: Lessons from a Decade of Access Regulations in the European Union Member States. 26th European Regional International Telecommunication Society Conference, San Lorenzo de El Escorial, Spanien, 25.06-27.06.2015.


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Abstract

This paper employs firm-level panel data of 57 incumbent and entrant firms for 23 European countries in the decade from 2003 to 2012. We examine the impact of service- and facility-based competition on firm-level investment as well as the strategic effects underlying infrastructure investment decisions. At the same time we explicitly model the structural dynamics of broadband investment by means of a flexible accelerator model. The empirical specification employs dynamic panel estimation techniques which allow us to account for various sources of endogeneity. We find that facility-based competition exerts a positive and significant impact on both incumbents and entrants implying that incumbents’ and entrants’ investment decisions are strategic complements. Moreover, we find that intermodal competition in terms of fixed-mobile substitution exerts different effects at the firm level. Finally, we show that service-based competition appears to have no significant impact on the investment decision of incumbents and entrants. However, with respect to the later phase of market liberalization, service-based competition exerts a negative impact on entrants’ investment. Our results thus also provide relevant policy guidance on the role of service-based competition in regulating emerging high-speed broadband infrastructure.

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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Paper presented at an academic conference or symposium
Language English
Title Facility- and Service-based Competition and Investment in Fixed Broadband Networks: Lessons from a Decade of Access Regulations in the European Union Member States
Event 26th European Regional International Telecommunication Society Conference
Year 2015
Date 25.06-27.06.2015
Country Spain
Location San Lorenzo de El Escorial
URL http://www.itseurope.org/wp/wp-content/uploads/2015/06/final-draft-programme22.6.2015.pdf
JEL L43, L52, L96

Associations

People
Briglauer, Wolfgang (Details)
Organization
Research Institute for Regulatory Economics FI (Details)
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