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Abstract: Regulating Vertical Integration in Broadband: Open Access versus Common Carriage
Abstract
Regulating Vertical Integration in Broadband: Open Access versus Common Carriage
The Review of Network Economics
Vol. 4, Issue 1 - March 2005, pp 19 - 32
Author
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Christiaan Hogendorn
Economics Department, Wesleyan University
E-mail: [email protected] |
Abstract
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Broadband Internet involves two vertical relationships: the Internet Service Provider (ISP) requires
both a physical conduit (e.g. telephone or cable television lines) and content. The ISP–conduit
relationship has been subject to controversial unbundling regulation, but no such rules apply to the
ISP–content relationship. We argue that regardless of whether ISPs are vertically integrated with
conduits, they have incentives to create vertical restrictions on content. Foreclosure of ISPs by
conduits may not increase and indeed could reduce these restrictions. Thus, telephone common
carriage and Internet application neutrality may both be at odds with unbundling and “open access”
policies.
Keywords: vertical integration, ISP, open access, regulation, foreclosure
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