Strategic Interaction Under Asymmetric Regulation: the 'Kiwi Share' in New Zealand Telecommunications

Regulation binds incumbent firms to a different set of obligations from their entrant-competitors thereby creating an asymmetric set of options from which the firms may select the strategies under which they will interact. Whilst most regulatory obligations are specified in law some take the form of contractual agreements. New Zealand's 'Kiwi Share' obligations bind the incumbent to a set of retail tariff structures and levels that have both restricted the incumbent's choices and opened up a range of new strategic opportunities for its rivals that have had a significant effect upon the development of the New Zealand industry. This paper examines the specific consequences of the asymmetric tariff obligations and ensuing strategic interaction amongst sector participants on sector development - namely the effect of universal service retail prices and the allocation of the ensuing costs on the sector's ongoing regulatory agenda; the role of a 'free local calling' obligation on the evolution of New Zealand's broadband market; and the consequent application of further asymmetric legislative obligations on the incumbent to address apparent "problems" for which the asymmetric tariffs and rivals' strategic choices provide more credible explanations than the incumbent's exertion of its dominant position

A Pendulous Progression: New Zealand Telecommunications Regulation 1987 -2007

Bronym Howell presented A Pendulous Progression: New Zealand Telecommunications Regulations 1987-2007 at FICORA (Finnish Telecommunications Regulatory Authority) in Helsinki Finland in May 200

Legal Protection for the Database: Is there a better way?

The business database is a valuable commodity. However without adequate legal protection the economic incentives required to invest in their creation ongoing updating and maintenance will be absent. The underlying objectives of many business databases can only be achieved if they are made accessible to the public; these databases are particularly vulnerable to misuse. Although copyright law provides protection for the original structure and format of a database judicial decisions in this area reveal many inconsistencies. In addition traditional copyright law fails to address the complexity of features found in a modern database. In this article we examine decisions from the European Union the United States and Australia and conclude that traditional copyright protection for the modern database is inappropriate. We analyse the structure of the 21st century business database and explain how copyright could protect specific features of this structure in a more nuanced fashion. As an alternative we consider the use of compulsory licensing as a suitable tool for protecting the economic value of the database

Next Generation Connectivity: A Review of Broadband Internet Transitions and Policy From Around the World

Fostering the development of a ubiquitously networked society, connected over high-capacity networks, is a widely shared goal among both developed and developing countries. High capacity networks are seen as strategic infrastructure, intended to contribute to high and sustainable economic growth and to core aspects of human development. In the pursuit of this goal, various countries have, over the past decade and a half, deployed different strategies, and enjoyed different results. At the Commission's request, this study reviews the current plans and practices pursued by other countries in the transition to the next generation of connectivity, as well as their past experience. By observing the experiences of a range of market-oriented democracies that pursued a similar goal over a similar time period, we hope to learn from the successes and failures of others about what practices and policies best promote that goal. By reviewing current plans or policy efforts, we hope to learn what others see as challenges in the next generation transition, and to learn about the range of possible solutions to these challenges

A Pendulous Progression: New Zealand's Telecommunications Regulation 1987-2007

New Zealand was the first country in the OECD to adopt a 'light-handed' approach to telecommunications regulation when in 1987 it eschewed industry-specific regulation for a generic competition law-based approach. The 'light-handed' regulatory environment prevailed throughout the 1990s during the privatisation of the incumbent provider the entry of competitive fixed-line infrastructure and services suppliers the establishment and growth of mobile market competition the expansion of the commercial internet and the consequent emergence of the 'information economy'. Over this period New Zealand emerged as one of the earliest-adopting and highest-utilising OECD countries with its ADSL services amongst the earliest highest quality most widely-available and lowest-priced in the OECD. Since 2000 however there has been a sea-change in the New Zealand approach to telecommunications regulation. Following a Ministerial Inquiry into the industry in 2000 industry-specific regulation was introduced in 2001 limited bitstream unbundling was imposed in 2004 full unbundling and the ability to undertake standard terms determinations were mandated in 2006 and in 2007 operational separation overseen by the Minister and not the regulator was imposed. Regulated mobile termination was also rejected in 2007 in favour of ministerially-brokered agreements. By tracing the economic performance of the New Zealand telecommunications sector during the periods of regulatory change in terms of productive allocative and dynamic efficiency this paper finds that there is little evidence to suggest that the 'light-handed' regime performed any worse than comparable industry-specific regimes over the same period. Rather the return to industry-specific regulation and each successive increasing of regulatory pressure appears to have been associated with reduced economic performance and reductions in competition relative to the regime replaced. Increased regulatory tension has also been associated with replacement of pursuit of economic efficiency as the sector objective with pursuit of competition in isolation from the efficiency consequences of this policy change. It is therefore unlikely that the latest changes including direct political control will deliver greater welfare to the New Zealand market. The paper suggests that an unjustified focus upon the incumbent's dominance as the underlying cause of poor competition metrics has resulted in policy-makers overlooking the role of the contribution of different regulations to the competition metrics observed. In particular the only regulations forming part of the light-handed regime which have not been overturned a universal service obligation and a mandatory tariff requiring no charges be levied for residential local telephony calls are materially connected with all of the poor performance indicators which have been used to justify increased sector regulation. These requirements persisted with because of political rather than economic efficiency imperatives provide a more plausible explanation for practically all of the positive and negative efficiency competition and strategic interaction observations observed in the New Zealand sector over the past 20 years than the alternative hypotheses that competition law has failed and the incumbent has exercised its dominant position unduly