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Antitrust Analysis for the Internet Upstream Market: a BGP Approach

Alessio D’Ignazio and Emanuele Giovannetti
Authors registered in the RePEc Author Service: Alessio D'Ignazio

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: In this paper we study concentration in the European Internet upstream access market. Measurement of market concentration depends on correctly defining the market, but this is not always possible as Antitrust authorities often lack reliable pricing and traffic data. We present an alternative approach based on the inference of the Internet Operators interconnection policies using micro-data sourced from their Border Gateway Protocol tables. Firstly we propose a price-independent algorithm for defining both the vertical and geographical relevant market boundaries, then we calculate market concentration indexes using two novel metrics. These assess, for each undertaking, both its role in terms of essential network facility and of wholesale market dominance. The results, applied to four leading Internet Exchange Points in London, Amsterdam, Frankfurt and Milan, show that some vertical segments of these markets are extremely competitive, while others are highly concentrated, putting them within the special attention category of the Merger Guidelines.

Keywords: Network Industries; Internet; Market Concentration; Essential Facilities; BGP (search for similar items in EconPapers)
JEL-codes: K21 L40 L86 L96 (search for similar items in EconPapers)
Pages: 31
Date: 2005-11
New Economics Papers: this item is included in nep-com, nep-ind, nep-law, nep-mic and nep-net
Note: IO
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Working Paper: Antitrust Analysis for the Internet Upstream Market: a BGP Approach (2006) Downloads
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