Essays in Telecommunications Economics

In the past decades telecommunications markets all over the world have changed immensely. Liberalization and privatization stimulated competition in fixed line telecommunications and helped increasing efficiency. Prices in fixed line telecommunications markets have decreased significantly, and consumers have the choice between a large number of products and services. During the last decade telecommunications regulators successfully opened the markets and helped fostering competition, especially on the service level. However, recently new regulatory challenges have arisen:1.How should regulators stimulate investments to enable network providers to create next generation networks?2.Do we still need different regulatory obligations for fixed and mobile markets?3.Do incumbents in mobile markets still have first mover advantages, or have they lost them as a result of increasing competitive pressure? These are important topics for future telecommunications regulation and this dissertation tries to give some answers to the questions stated above. The first part discusses theoretical and empirical work on the determinants of telecommunications investments and presents two possible solutions to the investment problem. The second part empirically analyzes determinants of telecommunications for 30 OECD countries from 1990 to 2003 and discusses the main findings in the context of the possible solutions presented in part one. In the third part of this dissertation competition in the German mobile telecommunications market is analyzed. The main question is whether there are still first mover advantages for T-Mobile and whether there is evidence of collusive behaviour between T-Mobile and Vodafone. The question of substitutability between fixed and mobile telecommunications is an important topic for regulatory agencies. In part four we test, whether customers substitute between fixed and mobile telecommunications on the subscribers stage and discuss the question, if different regulatory obligations for fixed and mobile markets are still needed.