Competition between telecommunications operators

Many observers of the telecommunications industry predict that regulation will soon give way to competition policy. The paper analyzes unregulated network competition, both in the mature and the transition phase of the industry. It considers competition in linear or nonlinear prices for customers, and also considers both nondiscriminatory pricing and termination-based discriminatory pricing. The paper investigates whether freely negotiated access charges are compatible with effective competition in the mature phase of the industry, and do not erect barriers to entry in the transition towards competition. Last, it analyzes the meaning and impact of the Efficient Component Pricing Rule in the context of network competition. (C) 1997 Elsevier Science B.V.