Strategic entry deterrence in a finite orbital environment

Sébastien Rouillon ()
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Sébastien Rouillon: BSE - Bordeaux sciences économiques - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement

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Abstract: This article suggests that, in a limited orbital environment, megasatellite constellations can be strategically scaled to discourage competitors from entering the market. It shows that an incumbent operator can deploy more satellites than are necessary for efficiency in order to increase congestion and reduce the incentive to enter the market. This oversizing reduces the lifespan of all satellites, including those of the incumbent operator, but may nevertheless prove profitable if it preserves monopoly rents. This study underscores that the regulation of space activities must be designed with both environmental constraints and the competitive context in mind. It also complements the existing literature on industrial organization by describing a new lever that grants a first-mover advantage within the framework of a sequential investment game.

Keywords: Space economics; Orbital congestion; Industrial organization; Économie de l’espace; Congestion orbitale; Organisation industrielle (search for similar items in EconPapers)
Date: 2026-07-01
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Published in Revue d'économie politique, 2026, 136 (3), pp.405-420. ⟨10.3917/redp.363.0155⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05746314

DOI: 10.3917/redp.363.0155

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