Essays in Telecommunications Policy and Management

<p>This work comprises three independent essays in Telecommunications Policy<br>and Management.</p> <p><br>In the first study we focus on the deployment of green field next generation<br>access network infrastructures when the national regulatory authority has the<br>power to define geographical markets at sub-national level for which it can apply<br>differentiated regulatory remedies - Geographically Segmented Regulation<br>(GSR). Using a game theory model that we developed, we confirm the asymmetric<br>business case for the geographic development of these new infrastructures:<br>highly populated areas are likely to develop into competitive telecommunication<br>markets while regions with low household density will only see limited investment<br>and little or no competition. We show that supply side interdependencies<br>among markets make the implementation of GSR non-trivial, namely, we show<br>that changes in the wholesale access price in one market can have undesirable<br>consequences in the competitive conditions of interrelated regions where<br>wholesale prices are unchanged.</p> <p>In the second study we focus on how individual purchase decisions are influenced by the behavior of others in their social circle. We study the case of<br>the diffusion of the iPhone 3G across a number of communities sampled from<br>a dataset provided by a major mobile carrier in one country. We find that<br>the propensity of adoption increases with the proportion of each indivudal's<br>adopter friends. We estimate that 14% of iPhone 3G adoptions in this carrier<br>were due to peer influence. We provide results from several policy experiments<br>that show that with this level of effect from peer influence the carrier would<br>hardly be able to significantly increase sales by selectively targeting consumers<br>to benefit from viral marketing.</p> <p><br>Finally, in the third study, we perform a randomized field experiment to<br>determine the role that likes play on the sales of movies in Video-on-Demand<br>(VoD). We use the VoD system of a large telecommunications provider during<br>half a year in 2012. The system suggests movies to consumers ordered by the<br>number of consumer likes they obtained in previous weeks. We manipulated<br>such natural order by randomly swapping likes across movies. We found that<br>movies promoted (demoted) increased (decreased) sales, but the amount of information<br>publicly available about movies affected the result. Better known<br>movies were less sensitive to manipulations. Finally a movie promoted (demoted)<br>to a fake slot sold 15.9% less (27.7% more) than a true movie placed at<br>that slot, on average across all manipulations. A movie promoted (demoted)<br>to a fake slot received 33.1% fewer (30.1% more) likes than a true movie at<br>that slot. Hence manipulated movies tended to move back to their true slots<br>over time. This means that self-fulfilling prophecies widely discussed in the<br>literature on the effect of ratings on sales are hard to sustain in markets with<br>costly goods that are sufficiently well-known.