Market Structure for Ultrabroadband
Communications & Strategies, Special Issue, November 2008
15 Pages Posted: 8 Apr 2009
Date Written: April 7, 2009
Abstract
Investors, operators, policymakers and other stakeholders need to contemplate the likely market structure for ultrabroadband (UBB) in various markets so that they can make effective investment, operational and policy decisions. There will not be a single, universal UBB market structure. Rather, market structures ranging from competition to duopoly and monopoly, including heavily subsidized systems, will be primarily a function of the number of UBB infrastructures that a particular market can sustain. The specific circumstances of each geographic market will therefore largely determine how many UBBs are sustainable and as the circumstances of each market change, market structures will also change. Because of fundamental economic factors such as economies of scale and first mover advantages, the likelihood is that UBB markets will become more concentrated (and not more competitive) than they are today. One of the most important predictors of future UBB market structure will be today's market structure for broadband services: since UBB will generally evolve from existing broadband infrastructures, the broadband past is likely to be the UBB prologue.
Keywords: market structure, monopoly, duopoly, competition, infrastructure
JEL Classification: L11, L12,L63, D41, D42
Suggested Citation: Suggested Citation
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