Broadband (BB) communications lie at the heart of any developing information and digital society. Employing the Gompertz model in a time-series study, we analyze the factors that influence the diffusion of fixed and mobile broadband across the OECD countries that have been categorized into five groups based on the stage of innovation, between 1998 and 2015. We find that although the diffusion time is similar for both technologies, the mobile broadband diffusion’s inflection time is asymmetric over the symmetric fixed broadband. The adoption time is almost double compared to the fixed, revealing a strong preference mostly of the developed countries on fixed broadband technology. Moreover, three out of the five innovation categories, in the classification method, the early adopters, early and late majority are really close to Roger’s criteria, aligning with recent literature findings, where countries are clustered into three groups, categorized by their diffusion rates and diffusion speeds.
Although technological developments have provided momentum to extend the frontier of commercially feasible network deployments, the latest data from ITU regarding affordability of ICT services shows that the digital divide between the rich and poor is still an open issue. Therefore, an economic framework is needed to create conditions for affordable network services. In this paper, we propose a set-aside mechanism that can satisfy this need by reserving resources for targeted groups and resolving the practical problem of having greedy users that rationally compete for cheaper resources. In this mechanism, prices are tailored to users’ budget capacities. Our simulation results indicate that it is possible to increase the resource allocation for delivering services to the poorest by inducing regular users to compete among themselves.
This study applies the recently developed novel panel vector autoregression models in a generalized method of moments (GMM) estimation framework to investigate the telecommunication infrastructures-defence-growth nexus for 157 countries between 2000 and 2018. To measure the defence sector, defence spending serves as the proxy, while economic growth is measured by the real gross domestic product, and telecommunication infrastructures are measured by a composite index of telecommunication (which comprises of mobile line, fixed line, and internet access penetration) via the principal component method. The empirical results at the global level show that telecommunication infrastructures, defence spending and growth jointly cause one another, while the direction of their effects differs. The direction of the causal-effect among the three variables for the income groups also differ. Thus, there is need to promote holistic policies that will reduce defence spending necessary for the enhancement of telecommunication infrastructures and inclusive economic growth at the global level, low-, upper-middle and high-income countries. A decrease in the allocation of funds to the defence sector will encourage enhancement of telecommunication infrastructures and aggregate output to move in the same direction.
The study in this paper investigates how information technology (IT), directly and indirectly, affects capital flows to Sub-Saharan African countries. It also examines the asymmetric effects of IT on capital flows. The general method of moments methodology is employed to estimate a decomposed model of capital flows, which produced results that clearly show the correlative effect of IT is relatively more significant, compared to the effects of other explanatory variables. Furthermore, the results reveal appreciable asymmetric effects of IT on capital flows and the components, with the effects found to be uneven and dissimilar. It is also revealed that capital flows and the components reinforced themselves over time. The salutary effects of IT on capital flows, therefore, need to be sustained. In order to achieve this goal, economic policies should be fashioned to drive the deepening of IT, stable policy environment, synergy among determinants of capital flows, usage of advanced IT in financial markets, awareness of investment opportunities in a real sector, and application of IT in weak sectors. Such policies are most likely to sustain and improve upon the current trend of capital flows to Sub-Saharan Africa.
Regulation of Next Generation Access Networks (NGANs) has been one of the most debated topics throughout the European Union (EU). Now it seems to be seeking to strike a new balance, between promoting NGANs investments and, simultaneously, preserving the current level of competition. This much-sought reconciliation was attempted with the release of European Commission (EC)‘s Recommendation 2013/466/EU on consistent non-discrimination obligations and costing methodologies for the promotion of competition and the enhancement of the broadband investment environment. The Recommendation, among others, defines the use of Economic Replicability Tests (ERTs), on the basis of a Discounted Cash Flow (DCF) approach, as the proper methodological tool to determine whether the dominant firm (i.e., incumbent operator) engages in a discriminatory behavior. The aim of this paper is twofold; first to investigate the impact of long-term access pricing agreements on ERT conduct as defined in Recommendation 2013/466/EU; second, in the light of the review of the aforementioned Recommendation, to attempt a non-conventional implementation of the test. The latter manifests itself via the potential use of Real Options Theory (ROT) within the ERT formulation on top of DCF results. The main objective is to investigate whether the fixed part of the wholesale access price - if the latter is seen as a two-part tariff - can actually be included in the calculation process to the contrary of what Jaunaux and Lebourges [ 39 ] suggest.
The present study is conceived to develop a model based on hedonic heuristics to deduce a performance index of service products offered by modern mobile telecommunication operators. The index so obtained includes the associated “price-worthiness” (value-for-money) aspects of the services; and, it is adopted to compare and evaluate the relative performance of competitive mobile networks deployed in a service area, supporting App-intense, smart, mobile-devices concomitant to traditional feature phones. Relevant operational details (such as technology-centric mobile-speed parameter of the services rendered) and the associated economic considerations are fused judiciously with hedonic perspectives of the users, in order to infer an overall performance metric for the mobile networks in question. Data availed from typical service areas in the U.S. relevant to specific mobile networks are gathered and a comparison of services rendered is made using the proposed measure. The measure of hedonic considerations specified here as the hedonic pricing index (HPI) leads to corresponding results on price-worthiness of underlying service products versus the techno-economic features; and, relevant aspects of certain incumbent networks in a selected service area in the U.S. are deduced, compared and discussed. Foreseeable limitations of HPI in ascertaining the mobile service performance are identified and discussed.
This paper investigates the extent to which the structure of the interaction network between suppliers and buyers affects equilibrium price heterogeneity. An incomplete interaction structure leads to uneven information flows and different information bases for consumers which is then taken into account by price setting producers. This results in heterogenous prices even if producers are identical in all other respects. The complete interaction network serves as a special case resembling standard monopolistic competition models. We show that a slight deviation from the complete network results in heterogeneous prices, although this heterogeneity becomes economically significant only under sparse or small networks. Sparsity as the main determinant of price heterogeneity dominates network asymmetry: relatively dense networks show minimal price dispersion even if its degree distribution follows a power law.
The study examines the relationship between ICT diffusion and climate change for a global panel of 92 countries for the period 1990 to 2018. The study constructs an index of ICT diffusion through principal component analysis and utilizes estimation techniques such as pooled ordinary least squares, the fixed effects model and the system generalized method of moments with panel corrected standard errors. Our study finds that in general, ICT diffusion mitigates CO2 emissions; however, financial development worsens climatic changes. Moreover, the findings indicate that higher levels of economic growth take care of CO2 emissions for the full sample and developing countries but not for the developed countries. On the other hand, trade openness shows differential impacts for developed and developing countries, suggesting that carbon implications of trade openness depend on the country's regulatory authority and ecological regulations. The study concludes that trade policies and financial development need to be rationalized for sustainable development. However, ICT diffusion should be encouraged as it leads to the mitigation of CO2 emissions.
We focus on the timely issue of Content Delivery Network (CDN) resource management. We introduce a multi-stage scheme that leverages solutions from the capital market. The mechanism of Stock Options (SOs) is used to address a potential scarcity of resources, not adequately addressed by other predictive mechanisms previously introduced by the authors. Using a Predictive Reservation Scheme (PRS), network resources offered by a CDN are monitored through established techniques (Kernel Regression Estimators) in a given time frame. Next, a Secondary Market (SM) significantly reduces resource waste by allowing the fast exchange of unused (remaining) resources granted to Origin Servers (OSs). This exchange occurs either by implementing socially optimal practices or by allowing automatic electronic auctions at the end of the day (EoD) or shorter time intervals. Finally, we further enhance our Load Prediction Mechanism (LPM); SOs are purchased and exercised, depending on the lack of resources at the EoD. As a result, OSs may acquire resources (if required) at a standard price. The effectiveness of the proposed stock market-based CDN resource management framework further improves.
The financial and economic crisis in Europe highlighted issues related to the competitiveness of member states, as well as the importance of measuring each country’s economic efficiency. Professional experts and the academic community are making efforts to develop appropriate strategies for each country to achieve sustainable growth. In the era of international competition, Information and Communications Technologies (ICTs) have been studied as a source for economic growth. This current study aims to expand our understanding on how ICTs can lead to economic growth in the Eurozone, officially called the Euro area. Our research targeted a 20-year period (1996–2016) but most emphasis has been put on the period of the economic crisis (2008–2016). Growth accounting methodology has been used, alongside regression analysis and the Cobb-Douglas production function, in order to estimate the Eurozone countries’ production functions. Results indicate that ICT capital is a factor of growing importance, during the economic crisis, which contributes positively to the economic growth of the Eurozone. Investments in ICT under economic crisis conditions seem to have a greater impact on development than in previous years, revealing the fundamental role of ICT in economic renaissance.
Whereas technical standards and Standard Setting Organizations (SSOs) are omnipresent and essential to mass production and communications, relatively little is formally known about the propensity of firms’ decisions to belong to certain SSOs. An understanding of such propensities can explain why some firms join SSOs (and others do not) and have implications for the regulation of SSOs. This paper uses a social network analysis technique to categorize/place firms in SSO communities and then empirically analyzes their propensities to belong to SSOs. We concentrate our study on standard setting organizations’ features and their intellectual property rights (IPR) policies such as licensing rules, disclosure requirements, as well as the features of the decision process of standards. Using data on more than 1060 member firms as participants in 28 SSOs, we are able to uniquely graph the membership of firms in SSOs by highlighting some important characteristics through community detection. The results provide some novel insights into why firms might choose certain SSO communities over others.
This paper adds some formal research to the success of ongoing efforts to combat the COVID-19 pandemic by examining the drivers of the administration and delivery efficiency of coronavirus vaccines. For this purpose, we use data from the 50 US states and place the formal analysis in the context of socio-economic drivers of vaccinations. Results show that state-economic prosperity and rural population aid vaccine administration and delivery efficiency. Delivery efficiency improves in states with more nursing homes per capita, in states with more COVID-19 deaths, and with more health workers. A subset of health workers, including physicians and nurses, did not significantly impact administration or efficiency. On the other hand, vaccination efficiency was lower in states with a centralized public health agency. States with a larger share of the elderly population and those with Democrats as governors were no different from others with regard to vaccinations. Robustness checks are performed using vaccination data from a more recent period. Finally, a state's legacy of corrupt activity, across two different time dimensions, is broadly consistent with the greasing effects of corruption. Some policy implications based on the evolving data are discussed.
Licensed Shared Access (LSA) is a new sharing approach that aims to optimize the use of the 2.3-2.4 Ghz frequency band in order to support the deployment of 5G systems. Under LSA, Mobile Network Operators (MNOs) can share the 2.3-2.4 band with the incumbent of that band under some guarantees, specified in a license attributed by the regulator. In this paper, we focus on ascending auctions to allocate and price licenses. We first show how to implement an ascending version of the well-known Vickrey-Clarke-Groves (VCG) mechanism in the LSA context, but highlight that it may introduce some computational complexity problems. We therefore propose another ascending mechanism, called C-LSA, based on the clinching approach. We also design the one-shot equivalent (in terms of allocations and payments) of C- LSA that we use to compare the performance of VCG and C-LSA through simulations. Our simulations suggest that C-LSA is an interesting candidate to allocate LSA licenses, since the mechanism yields considerably larger revenues than VCG, for a very limited loss of allocation efficiency (around 4%).
This study investigates the impact of digital technology adoption on economic growth and labour productivity in Nigeria for the period of 1990–2019. Based on an Augmented Solow Model of a hypothesised positive relationship between digital technology adoption and economic growth, we employ a Structural Vector Autoregressive (SVAR) framework and extract from it the Impulse Response Function (IRF) that measures the response of economic growth and labour productivity to a shock in digital technology adoption. We also examine the Forecast Error Variance Decomposition (FEVD), that shows the proportion of movement in economic growth and labour productivity that can be attributed to innovations in digital technology. Furthermore, a VAR Granger Causality test was conducted to ascertain the direction of causality between the variables. Overall, we find that the impact of shocks to digital technology adoption on economic growth and labour productivity is negative and significant in the short-term (within the first four quarters). However, in the medium term and above (from the fifth quarter and above), the impact of digital technology shocks becomes positive. Again, we find from the VAR Granger Causality test, that the direction of causality runs uni-directionally from digital technology to economic growth, and labour productivity. The study recommends that amongst others, industry players and government must train and re-train their workforce to quickly adapt to emerging technologies which will help reduce the time lag in reaping the full benefit of such technology. Again, there should be policies to improve the regulatory oversight of the digital technology sector in the country, to correct any market failures, while also ensuring that the proportion of Nigerians with access to digital technology tools and services keeps expanding.
Following the increasing need for higher broadband speeds, the European Commission (EC) has set specific goals to all member states regarding the development of new generation networks. Due to the high deployment cost, many countries have adopted only a partial transition to a purely optical fiber network. Fiber-to-the-Cabinet (FttC) architecture combined with very-high-bit-rate digital subscriber line 2 (VDSL2) and vectoring noise cancellation techniques may provide a more viable short-term solution. Technoeconomic analysis is vital at the initial development stages of a telecom network, which usually require large investments in infrastructure. This analysis addresses the viability of the project from a financial perspective. In this paper, we present a technoeconomic framework for the analysis of VDSL2 vectoring technology with its subsequent G.fast upgrade and illustrate its applicability in a particular suburb of the city of Athens, Greece. A number of different scenarios is evaluated predicting profits even from the first quarters. The analysis includes an estimation of the degree of market penetration, analytical cost calculations for the implementation and operation of the network leading to the evaluation of financial indicators regarding the prospects of the investment in vectoring services. The overall framework can be applied in similar evaluations, regarding the deployment of telecommunication access networks.
There is a trend for big content providers such as Netflix and YouTube to give grades to Internet Service Providers (ISPs), to incentivize those ISPs to improve at least the quality offered to their service. We design in this paper a model analyzing ISPs’ optimal allocation strategies in a competitive context and in front of quality-sensitive users. We show that the optimal strategy is non-neutral, that is, it does not allocate bandwidth proportionally to the traffic share of content providers. On the other hand, we show that non-neutrality does not benefit ISPs but is surprisingly favorable to the perceived quality for users.
We describe a marketplace for content (digital media) distribution, specifically stored-video streaming, involving both edge cloud (fog) and remote cloud-computing and storage resources. Three different types of competing participants are considered: providers that are affiliated with the remote cloud, those that are affiliated with the ISP/edge, and those affiliated with neither. For a simple model, we explore the existence of a Nash equilibrium. Furthermore, we formulate a leader-follower game involving a market regulator maximizing social welfare and study its Stackelberg equilibrium. For a market regulator seeking to limit prices charged by an edge-cloud entrant, we show an interesting trade-off between “moderate” edge-cloud prices and the existence of a follower (Nash) equilibrium.
We study the dynamic optimization of platform pricing in industries with positive direct network externalities. The utility of the network for the consumer is modeled as a function of three components. Platform price and participation rate affect the consumer’s decision to join the platform. The platform operator is assumed to know the consumer’s sensitivities with respect to these components. In addition, the consumer’s utility is a function of other attributes, such as network privacy policies and environmental effects of the service. We assume that the distribution of these unobserved preferences in the potential customer base is known to the platform operator. We show analytically how the unobserved preferences affect the dynamic platform price design. Both static and rational expectations with respect to the platform participation are presented. We simulate an electricity market demand side management service application and show that the platform operator sets low prices in the launch phase. The platform operator can set higher launching prices if it can affect customers’ preferences, expectations or adjustment friction.
The research has largely documented favorable economic outcomes of investing in Information Communication Technologies (ICTs). Does implementation and adoption of ICT in the public sector also lead to favorable economic gains? The answer to this question has received little attention. The available evidence is largely country-specific from the developed world. This study contributes to the empirical literature on ICT-growth nexus by analytically exploring and empirically testing the relationship of e-government with economic growth of 122 developing economies over the period 2003–2015. The empirical analysis is based on Fixed Effects, Random Effects, and System Generalized Method of Moments (GMM). The results show that an implementation of an e-government in developing economies causes a robust positive impact on economic growth. This finding is shown to be robust to different specifications, to different econometric techniques and to the endogeneity problem.
A business model can be perceived as a simple, yet focused, representation of the related activities of a company, which describes how to create the value of the company in terms of information, products and services. Given the significance of the Internet service infrastructure in new Internet-based business logic, notably the positive relationship between the growth of the Internet service infrastructure and GDP growth, this paper elaborates on the business model of the Internet service providers (ISPs). Accordingly, the ISPs' business model, in the scope of connectivity service providers, based on the selected meta model (Hedman and Kalling's ontology) at the industry level is analyzed. For validation and generalization assessment, the business components of two ISPs at the instance level and the business components of other service providers in the telecom industry (beyond the scope of this research) are compared, point by point, with the proposed business model components, respectively. The results of this study will raise the awareness of ISPs' executives and new entrants of different aspects of this business. The proposed business model can be considered as a basic model in the area of designing new business models, especially in the area of new Internet-based technologies.
