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Net Neutrality and the Incentives (Not) to Exclude Competitors

Ralf Dewenter and Jürgen Rösch ()
Additional contact information
Jürgen Rösch: Helmut Schmidt University, Hamburg, Postal: Department of Economics, Holstenhofweg 85, 22043 Hamburg, Germany

No 149/2014, Working Paper from Helmut Schmidt University, Hamburg

Abstract: This paper analyses the incentives of a vertical integrated Internet service provider (ISP) to block competitors from content markets. Using a simple model we find that the ISP does not block competing content providers as long as the contents are differentiated sufficiently. Exclusion only takes place when the competitor offers perfect homogeneous content and the ISP has a local monopoly over its Internet access customers or if network effects are strong. In this case, however, the abuse of market power can at least in Europe be prohibited by competition authorities. That is, according to our model there is no need for a regulation of net neutrality.

Keywords: net neutrality; competition; Internet service providers (search for similar items in EconPapers)
JEL-codes: D40 K20 L12 L82 L86 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2014-07-28
New Economics Papers: this item is included in nep-com, nep-ict, nep-law, nep-mic, nep-mkt, nep-net and nep-reg
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Related works:
Journal Article: Net Neutrality and the Incentives (Not) to Exclude Competitors (2016) Downloads
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