Martin Distelkamp
Möglichkeiten des Wettbewerbs im Orts- und Anschlußbereich des Telekommunikationsnetzes
Nr. 196 / Oktober 1999
Summary
After the full liberalisation of the German telecommunication market in January 1998 and the wide establishment of competition in the market segment for long distance calls, especially the opportunities of competition in the local and access part of the telecommunication network are moving into the centre of interest. Regarding the barriers to entry on the local telecommunication market, especially the facilities on the last mile show the characteristics of a bottleneck factor. Still it is possible to argue that even this part of the market is not an entry resistant natural monopoly. Some arguments in favour of a diminished resistance of entries are the developments in the fields of demand for narrow- and broadband services, the institutional basic conditions and especially the production technology to by-pass the last mile.
Despite the problems to predict exactly the development of demand for narrow- and broadband services, one can assume a strong market growth at least for some multimedia services such as Internet. This leads to the belief that there might be a high potential for broadband access. Due to the developments in the field of production technology, the established supplier in that market segment can not base his competitive advantage purely on the copper network.
The main conditions for competition in the local and access part have been created by the regulation of unbundling, interconnection, numbering, universal service obligation and the principles for the use of ways in the German Telecommunications Act. Furthermore it has been assured by the orientation of cost efficient tariffs, especially in the case of the decision about the amount of the fee for the access to the unbundled subscriber line, that network competition can arise there, and only there, where it is economically useful.
In analysing alternative production technologies to by-pass the last mile (xDSL, conversion of cable-TV-networks, fibre, powerline communication and Radio in the Loop) it turns out that each of these technologies has its specific strength and weaknesses. This holds for example with regards to the bandwidth, the security of transmission, the absolute costs and the cost structures. Based on the current knowledge it seems that none of the broadband access variants has clear advantages compared to all other alternatives. Rather it can be estimated that each of the technologies has a chance to gain a certain market share. This estimation can change, when first extensive market entries with one of these technologies occur. Possibly then a "first-mover advantage" will appear.
Only German language version available.