Interconnected Networks

TILEC Discussion Paper Series 2005-007

175 Pages Posted: 9 Nov 2006

See all articles by Paul de Bijl

Paul de Bijl

CPB Netherlands Bureau of Economic Policy Analysis

Eric van Damme

TILEC and CentER, Tilburg University

Gert Brunekreeft

Tilburg Law and Economics Center (TILEC)

Pierre Larouche

Université de Montréal; Center on Regulation in Europe (CERRE)

Valter Sorana

Charles River Associates (CRA)

Natalya Shelkoplyas

affiliation not provided to SSRN

Date Written: February 2005

Abstract

In this paper, we take a critical perspective on the common regulatory reply to deal with call termination on mobile networks. The current policy tendency to deal with fixed-to-mobile call termination is to restrict attention to the defined relevant market (call termination on single networks is the usual outcome), establish substantial market power, and regulate the prices in question. This approach is understandable within the context of the regulatory framework in the EU, but it ignores important elements of the broader picture and therefore risks to be misguided from a welfare viewpoint. Compared to price controls, there exist alternative, less heavy-handed, ways to intervene, which are directly aiming at the root cause of the problem and can make access regulation unnecessary. For instance, inducing mobile operators to apply RPP instead of CPP is a straightforward and simple remedy, as it instantaneously eliminates the root cause of call termination monopolies.

Keywords: Telecommunications, Fixed-mobile call termination, Access regulation

JEL Classification: L41, L51, L96

Suggested Citation

de Bijl, Paul W.J. and van Damme, Eric E.C. and Brunekreeft, Gert and Larouche, Pierre and Sorana, Valter and Shelkoplyas, Natalya, Interconnected Networks (February 2005). TILEC Discussion Paper Series 2005-007, Available at SSRN: https://ssrn.com/abstract=871391

Paul W.J. De Bijl (Contact Author)

CPB Netherlands Bureau of Economic Policy Analysis ( email )

P.O. Box 80510
The Hague, 2508 GM
Netherlands
+31 70 3383380 (Phone)
+31 70 3383350 (Fax)

Eric E.C. Van Damme

TILEC and CentER, Tilburg University ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands
+31 13 466 3045 (Phone)
+31 13 466 3066 (Fax)

Gert Brunekreeft

Tilburg Law and Economics Center (TILEC) ( email )

Warandelaan 2
Tilburg, 5000 LE
Netherlands

Pierre Larouche

Université de Montréal ( email )

Montreal, Quebec H3T 1B9
Canada

Center on Regulation in Europe (CERRE) ( email )

Rue de l'Industrie 42
Brussels, 1040
Belgium

Valter Sorana

Charles River Associates (CRA) ( email )

1201 F. St. NW
Ste. 700
Washington, DC 20004
United States

Natalya Shelkoplyas

affiliation not provided to SSRN

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