Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/180268
Authors: 
Bourreau, Marc
Grzybowski, Lukasz
Hasbi, Maude
Year of Publication: 
2018
Series/Report no.: 
CESifo Working Paper 7006
Abstract: 
We use panel data on 36,104 municipalities in metropolitan France over the period 2010-2014 to estimate two models of entry into local markets by: (i) alternative operators using wholesale access to the legacy copper network via local loop unbundling (LLU), and (ii) the incumbent and two alternative operators using the fiber technology. We find that a higher number of LLU competitors, and hence a less concentrated local market, has a positive impact on entry by fiber operators. Moreover, the presence of upgraded cable network in the local municipality stimulates fiber deployment. However, firms may choose to upgrade copper lines instead of investing in fiber networks. We use the estimates to calculate entry thresholds into local markets, which are substantially lower for broadband provision via LLU than via fiber and decrease over time. Fiber deployment becomes cheaper over time, but according to our estimates it will remain unprofitable for the vast majority of municipalities in France within the next years.
Subjects: 
fiber broadband
local loop unbundling
market entry
JEL: 
K23
L13
L51
L96
Document Type: 
Working Paper
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