Telecommunications Economics and Policy Issues

CONTENTS

Preliminaries
Cover, Copyright, Acknowledgements, Contents, Abbreviations, Summary

PART A   TELECOMMUNICATIONS ECONOMICS

1   Supply of telecommunications services
1.1   Telecommunications networks
1.2   Customer premises equipment
1.3   Transmission facilities
1.4   Switching equipment
1.5   Summary

2   Economies of scale and scope in telecommunications
2.1   Characteristics of a natural monopoly
2.2   Review of empirical studies examining natural monopoly in the local network
2.3   Conclusion

3   Demand for telecommunications services
3.1   Telecommunications demand
3.2   Customer access
3.3   Local calls
3.4   Long-distance calls
3.5   International calls
3.6   Broadband services
3.7   Summary

4   Efficient pricing of telecommunications services
4.1   Public utility pricing principles
4.2   Efficiency and cost recovery in telecommunications pricing
4.3   Importance of network externalities in telecommunications
4.4   Regulation of telecommunications pricing
4.5   Conclusion

5   Competition in basic telecommunications services
5.1   Reasons for network competition
5.2   Network competition through interconnection to the essential facility
5.3   Interconnection access pricing principles
5.4   Institutional basis for the provision of access
5.5   Conclusion

PART B   TELECOMMUNICATIONS POLICY ISSUES

6   Introduction to the policy issues
6.1   Changes to Australian telecommunications since 1975
6.2   The issues considered in this study

7   Benefits and costs of two local networks
7.1   The evolution in international thinking about natural monopoly in the local network
7.2   The evolution in thinking about natural monopoly in Australian telecommunications
7.3   The cases for and against two pay-TV/local communications networks
7.4   Conclusion

8   Regulation and the efficiency of final product pricing
8.1   Regulatory influences on Australian telecommunications pricing
8.2   The broad structure of Australian telecommunications pricing
8.3   Efficiency gains from price rebalancing
8.4   Distributional implications of price rebalancing on households

9   Interconnect access pricing
9.1   Early Australian experience with interconnect access pricing
9.2   Access pricing for Optus under duopolistic network competition
9.3   Conclusion

10   Institutional structure for competition
10.1   Existing structural arrangements
10.2   Difficulties with the existing structure
10.3   Approaches to reform
10.4   Conclusion

PART C   APPENDICES

A   Demand studies

B   Data on telecommunications traffic, revenues and costs for 1995-96

C   Details of estimating the efficiency gains from price rebalancing

References