The Determinants of the Global Mobile Telephone Deployment: An Empirical Analysis

This study aims to analyze the global mobile phones by examining the instruments stimulating the diffusion pattern. A rigorous demand model is estimated using global mobile telecommu-nications panel dataset comprised with 51 countries classified in order to World Bank income categories from 1990-2007. In particular, the paper examines what factors contribute the most to the deployment of global mobile telephones. To construct an econometric model, the number of subscribers to mobile phone per 100 inhabitants is taken as dependent variable, while the following groups of variables (1) GDP per capita income and charges, (2) competition policies (3) telecom infrastructure (4) technological innovations (5) others are selected as independent variables. Estimation results report the presence of substantial disparity among groups. Additionally GDP per capita income and own-price elasticity comprised with call rate, subscription charges, are reported. The analysis of impulse responses for price, competition policies, and technological innovations such as digitalization of mobile network, mobile network coverage indicates that substantial mobile telephone growth is yet to be realized especially in developing countries. A new and important empirical finding is that there are still many opportunities available for mobile phone development in the world pro-poor nations by providing better telecom infrastructure.Mobile Phone Adoption, 3G, Technological Innovations, Competition Policy, Panel Data Analysis, Digital Divide

Telecommunication reforms, access regulation, and Internet adoption in Latin America

The authors review the stylized facts on regulatory reform in telecommunications and its effects on telecommunications development and Internet penetration in Latin America. Relying on data from the International Telecommunication Union, the Information for Development Program (InfoDev), and the World Bank for 1990-99, the authors then test econometrically the determinants of the differences in Internet penetration rates across Latin America. The results show that effective implementation of the reform agenda in telecommunications regulation could accelerate adoption of the Internet in Latin America-even though it is only part of the solution (income levels, income distribution, and access to primary infrastructure are the main determinants of growth in Internet connections and use). Regulation will work by cutting costs. Cost cutting will require that regulators in the region take a much closer look at the design of interconnection rules and at the tradeoffs that emerge from the complex issues involved. It will also require a commitment to developing analytical instruments, such as cost models, to sort out many of the problems. Appropriate cost models will generate benchmarks that are much more consistent with the local issues and with the local cost of capital than international benchmarks will ever be for countries in unstable macroeconomic situations. Cost cutting will require an equally strong commitment to imposing regulatory accounting systems that reduce the information asymmetrics that incumbents use to reduce the risks of entry. All these changes will ultimately require a stronger commitment by competition agencies, since in many countries a failure to negotiate interconnection agreements will raise competition issues just as often as it will raise regulatory questions.Rural Communications,Information Technology,Telecommunications Infrastructure,Knowledge Economy,Health Monitoring&Evaluation,Knowledge Economy,Information Technology,Health Monitoring&Evaluation,Rural Communications,Education for the Knowledge Economy

Subsidies and distorted markets: Do telecom subsidies affect competition?

There is general concern that producer subsidies distort competition. We examine a telecommunications subsidy system that transfers money from low cost regions to high cost regions of the U.S. Even though the system is designed to be competitively neutral, we find evidence that the system, combined with carrier of last resort policies, promotes cream skimming by entrants in low cost areas and deters entry in high cost areas, where incumbents are more likely than entrants to receive subsidies. We are unable to rule out the possibility that state regulatory policies favor incumbents in states that are net beneficiaries of the subsidy system.subsidies, Universal Service Fund, telecommunications, regulation

Regulation and Internet Use in Developing Countries

Concerns about a worsening "digital divide" between rich and poor countries parallel the hope that information and computing technologies (ICTs) could increase economic growth in developing countries. Little research, however, has explored ICT growth beyond noting that it is correlated with standard development indicators, and no empirical research has explored the role of regulation. In this paper, Scott Wallsten uses data from a unique new survey of telecommunications regulators and other sources to measure the effects of regulation on Internet development. Controlling for factors such as income, telecommunications infrastructure development, ubiquity of personal computers, and time trends,Mr.Wallstenfinds that countries requiring formal regulatory approval for Internet Service Providers (ISPs) to operate have fewer Internet users and hosts than countries that do not require such approval. Moreover, countries that regulate ISP final-user prices have higher Internet access prices than countries without such regulations. These results suggest that developing countries' own regulatory policies can have large impacts on the digital divide.Technology and Industry, Regulatory Reform, Other Topics

Assessment of First Comer Advantages and Network Effects; the Case of Turkish GSM Market

First comer advantages and network effects are frequently stated as among the most important determinants of market structures and this is particularly relevant for network economies including telecommunications markets. Connected to this, regulatory tools such as number portability have frequently been used to reduce market imperfections resulting from these effects. Within this context, this paper aims to analyze the role of these factors in creating the current market structure of Turkish GSM sector. By examining relevant data such as development of market shares in a historical perspective and by making use of consumer surveys, it is concluded that the dominant operator has benefited from being first comer in the market and established a stable market share (power) due to network effects that are used by this firm deliberately to entrench its position especially in the form of switching costs, scale economies, brand image and tariff (on-net vs. off-net pricing) differentiation; however, it is also observed that introduction of number portability lead to reduction in switching costs, increasing market competition. --First comer advantages,Network effects,Mobile telephony (GSM),number portability,Competition,Regulation and Consumer preferences

Acceptance of mobile services - insights from the Swedish market for mobile telephony

The main purpose of the paper is to investigate young peoples’ perspectives on mobile services in order to shed light on the acceptance of mobile services. The knowledge of and interest in mobile services of individuals using such services is analyzed. A second objective is to investigate the reasons for using/not using mobile services. In-depth focus group interviews and secondary empirical data provide the main data. Concerning the youth’s general knowledge of and interest in mobile services, the results point to six things: young people show a low demand for many mobile services, there is a demand for extended, established mobile services, like SMS, the interest in the new services vary, there is low interest in active information search, there is little knowledge of the enabling technology, and the understanding of the pricing is generally low. As concerns reasons for and against usage of mobile services, results point to four central aspects: many individuals could present clearly defined needs for certain services, many indicated an interest in "community usage" of mobile services, they experienced the prices of mobile services to be a hinder for usage, and technology placed limitations on the usage. The paper discusses practical implications on the acceptance of mobile services.Mobile services; mobility; focus groups; telecommunications; wireless; knowledge

Innovation and Diffusion

The contribution made by innovation and new technologies to economic growth and welfare is largely determined by the rate and manner by which innovations diffuse throughout the relevant population, but this topic has been a somewhat neglected one in the economics of innovation. This chapter, written for a handbook on innovation, provides a historical and comparative perspective on diffusion that looks at the broad determinants of diffusion, economic, social, and institutional, viewed from a microeconomic perspective. A framework for thinking about these determinants is presented along with a brief nontechnical review of modeling strategies used in different social scientific literatures. It concludes with a discussion of gaps in our understanding and potential future research questions.

Household Demand for Broadband Internet Service

As part of the Federal Communications Commission (“FCC”) National Broadband Report to Congress, we have been asked to conduct a survey to help determine consumer valuations of different aspects of broadband Internet service. This report details our methodology, sample and preliminary results. We do not provide policy recommendations. This draft report uses data obtained from a nationwide survey during late December 2009 and early January 2010 to estimate household demand for broadband Internet service. The report combines household data, obtained from choices in a real market and an experimental setting, with a discrete-choice model to estimate the marginal willingness-to-pay (WTP) for improvements in eight Internet service characteristics.