Asymmetric Competition in Network Services Provision in the Telecommunications Subsystems

Abstract

The majority of network services provision (postal and telecommunicationsservices, rail transport, air transport, etc.)were traditionally considered as natural monopoly. New scenarioof the liberalised national market and 'Open NetworkProvision' require precise and concrete economic evaluationbefore implementation itselfThis paper considers the methodology for the application ofnatural monopoly with the concept of cost sub-additivity. It ispointed out that the scale and scope economies, associatedwith 'plant (network) sub-additivity' is not sufficient to justifythe monopoly in every service provision in the traffic system andits subsystems. The paper considers and analyses the possiblemarket configuration with various degrees of competition fortelecommunication subsystem. The asymmetric competition inthe telecommunication subsystem by means of the dominantorganisation model has been analysed.

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