8 research outputs found
Net Neutrality on the Internet: A Two-sided Market Analysis
We discuss net neutrality regulation in the context of a two-sided
market model. Platforms sell Internet access services to consumers and
may set fees to content - and application providers on the Internet.
When access is monopolized, for reasonable parameter ranges, net
neutrality regulation (requiring zero fees to content providers)
increases the total industry surplus as compared to the fully private
optimum at which the monopoly platform imposes positive fees on content
providers. However, there are also parameter ranges for which total
industry surplus is reduced. Imposing net neutrality in duopoly with
multi-homing content providers and single-homing consumers increases the
total surplus as compared to duopoly competition with positive fees to
content providers
Net Neutrality on the Internet: A Two-sided Market Analysis
We discuss net neutrality regulation in the context of a two-sided
market model. Platforms sell Internet access services to consumers and
may set fees to content - and application providers on the Internet.
When access is monopolized, for reasonable parameter ranges, net
neutrality regulation (requiring zero fees to content providers)
increases the total industry surplus as compared to the fully private
optimum at which the monopoly platform imposes positive fees on content
providers. However, there are also parameter ranges for which total
industry surplus is reduced. Imposing net neutrality in duopoly with
multi-homing content providers and single-homing consumers increases the
total surplus as compared to duopoly competition with positive fees to
content providers
Net Neutrality on the Internet: A Two-sided Market Analysis
We discuss net neutrality regulation in the context of a two-sided
market model. Platforms sell Internet access services to consumers and
may set fees to content - and application providers on the Internet.
When access is monopolized, for reasonable parameter ranges, net
neutrality regulation (requiring zero fees to content providers)
increases the total industry surplus as compared to the fully private
optimum at which the monopoly platform imposes positive fees on content
providers. However, there are also parameter ranges for which total
industry surplus is reduced. Imposing net neutrality in duopoly with
multi-homing content providers and single-homing consumers increases the
total surplus as compared to duopoly competition with positive fees to
content providers
Net Neutrality on the Internet: A Two-sided Market Analysis
We discuss net neutrality regulation in the context of a two-sided
market model. Platforms sell Internet access services to consumers and
may set fees to content - and application providers on the Internet.
When access is monopolized, for reasonable parameter ranges, net
neutrality regulation (requiring zero fees to content providers)
increases the total industry surplus as compared to the fully private
optimum at which the monopoly platform imposes positive fees on content
providers. However, there are also parameter ranges for which total
industry surplus is reduced. Imposing net neutrality in duopoly with
multi-homing content providers and single-homing consumers increases the
total surplus as compared to duopoly competition with positive fees to
content providers
Net Neutrality on the Internet: A Two-sided Market Analysis
We discuss net neutrality regulation in the context of a two-sided
market model. Platforms sell Internet access services to consumers and
may set fees to content - and application providers on the Internet.
When access is monopolized, for reasonable parameter ranges, net
neutrality regulation (requiring zero fees to content providers)
increases the total industry surplus as compared to the fully private
optimum at which the monopoly platform imposes positive fees on content
providers. However, there are also parameter ranges for which total
industry surplus is reduced. Imposing net neutrality in duopoly with
multi-homing content providers and single-homing consumers increases the
total surplus as compared to duopoly competition with positive fees to
content providers
Net Neutrality on the Internet: A Two-sided Market Analysis
We discuss net neutrality regulation in the context of a two-sided
market model. Platforms sell Internet access services to consumers and
may set fees to content - and application providers on the Internet.
When access is monopolized, for reasonable parameter ranges, net
neutrality regulation (requiring zero fees to content providers)
increases the total industry surplus as compared to the fully private
optimum at which the monopoly platform imposes positive fees on content
providers. However, there are also parameter ranges for which total
industry surplus is reduced. Imposing net neutrality in duopoly with
multi-homing content providers and single-homing consumers increases the
total surplus as compared to duopoly competition with positive fees to
content providers
Entrepreneurial Innovations in Network Industries
We contribute to the literature network effects by allowing
entrepreneurs to sell their innovations to incumbents in addition to
entering the industry. We identify three new effects. Stronger network
effects make selling innovations attractive, as incumbents bid up the
sales price in fear of letting a rival obtain the innovation. This
improves innovation incentives. Increased compatibility, however,
reduces innovation incentives by reducing the relative advantage the
owner of the innovation gets, in turn resulting in a lower sales price.
Finally, bidding competition for innovations is crucial. Innovation
waves can occur in network industries as bidding competition is fierce
in young industries with several players competing for the top spot, but
weak in mature industries with a clear leader
Entrepreneurial Innovations in Network Industries
We contribute to the literature network effects by allowing
entrepreneurs to sell their innovations to incumbents in addition to
entering the industry. We identify three new effects. Stronger network
effects make selling innovations attractive, as incumbents bid up the
sales price in fear of letting a rival obtain the innovation. This
improves innovation incentives. Increased compatibility, however,
reduces innovation incentives by reducing the relative advantage the
owner of the innovation gets, in turn resulting in a lower sales price.
Finally, bidding competition for innovations is crucial. Innovation
waves can occur in network industries as bidding competition is fierce
in young industries with several players competing for the top spot, but
weak in mature industries with a clear leader