Regulated access schemes shape incentives for both investment and entry in next-generation networks. We study in a general duopoly setting whether and how risk premia, access options or long-term contracts improve those incentives as compared to standard access pricing. The first two do so: Risk premia guarantee highest coverage, while distorting retail pricing. Access options safeguard undistorted retail competition, but are not effective in the most costly areas. On the other hand, long-term contracts have little scope to increase coverage because they intensify retail competition.
Fiber investment and access under uncertainty: long-term contracts, risk premia, and access options / Bourreau, M.; Cambini, C.; Hoernig, S.; Vogelsang, I.. - In: JOURNAL OF REGULATORY ECONOMICS. - ISSN 0922-680X. - (2020). [10.1007/s11149-020-09402-3]
Fiber investment and access under uncertainty: long-term contracts, risk premia, and access options
Cambini C.;
2020
Abstract
Regulated access schemes shape incentives for both investment and entry in next-generation networks. We study in a general duopoly setting whether and how risk premia, access options or long-term contracts improve those incentives as compared to standard access pricing. The first two do so: Risk premia guarantee highest coverage, while distorting retail pricing. Access options safeguard undistorted retail competition, but are not effective in the most costly areas. On the other hand, long-term contracts have little scope to increase coverage because they intensify retail competition.File | Dimensione | Formato | |
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https://hdl.handle.net/11583/2808468