Economic replicability tests for next-generation access networks

Konferenzbeitrag

This paper discusses the relevant cost standard for the economic replicability test for Next-Generation Access (NGA) networks, described in the Recommendation on Costing and Non-discrimination adopted by the European Commission. We demonstrate that a cost standard that implies fully fixed and variable cost recovery for the access seeker would be incompatible with the economics of NGA networks and that such a test would deter NGA investment. We show that to reconcile investment and competition, the wholesale price must be a two-part tariff and the economic replicability test should only be based on variable wholesale prices. We underline that during a transition phase, until competitors have secured access to NGA infrastructure, a temporary second test called the 'competition migration test' should be added to ensure incumbent NGA retail prices do not foreclose copper-based efficient entrants. The tests we propose surpass the limits of the 'ladder of investment' theory by including the business migration effect developed by Bourreau et al. (2012).

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: 24th European Regional Conference of the International Telecommunications Society (ITS): "Technology, Investment and Uncertainty", Florence, Italy, 20th-23rd October, 2013

Classification and Topics

• Classification: Wirtschaft ; Economics of Regulation ; Telecommunications
• Subject: Margin squeeze ; Regulation ; Next-generation access networks

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Jaunaux, Laure ; Lebourges, Marc
• Event: Veröffentlichung
• (who): International Telecommunications Society (ITS)
• (where): Calgary
• (when): 2013

Further information

• Handle: http://hdl.handle.net/10419/88501
• Last update: 10.03.2025, 11:42 AM CET