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Vertical structure of the industry and competition: an analysis of the evolution of the info-communications industry

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  • Krafft, Jackie

Abstract

The purpose of this paper is threefold. First, the paper provides a synthesis of the potentialities and limits of the dominant economic literature on vertical contractual relations which essentially focuses on the impact of vertical specialization and vertical integration on competition and customers' welfare. Second, the paper proposes a characterization of the different degrees of vertical specialization and vertical integration for key actors in the info-communications industry: equipment suppliers, telcos, ISPs/IAPs, navigation and software/middleware companies, information and content companies. Thirdly, the paper acknowledges a confrontation between, on the one hand, optimal vertical structures exhibited in dominant economic models and, on the other hand, observed vertical structures in the info-communications industry. From this confrontation emerges an important gap between theoretical results and observable trends. The outcome of this paper is thus that the dynamics between vertical relationships and competition requires a new research agenda, especially for researchers concerned with the evolution of the info-communications industry.

Suggested Citation

  • Krafft, Jackie, 0. "Vertical structure of the industry and competition: an analysis of the evolution of the info-communications industry," Telecommunications Policy, Elsevier, vol. 27(8-9), pages 625-649, September.
    • Handle: RePEc:eee:telpol:v:27:y::i:8-9:p:625-649
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    Citations

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    Cited by:

    1. Dan Huang & Luxun Liu, 2014. "Micro-determinants of vertical integration: Evidence from China," Asia Pacific Journal of Management, Springer, vol. 31(2), pages 377-396, June.
    2. Jackie Krafft, 2010. "Profiting in the info-communications in the age of broadband: lessons and new considerations," Post-Print hal-00203801, HAL.
    3. Krafft, Jackie, 2004. "Entry, exit and knowledge: evidence from a cluster in the info-communications industry," Research Policy, Elsevier, vol. 33(10), pages 1687-1706, December.
    4. Pascal Le Masson & Armand Hatchuel & Benoit Weil, 2010. "Modeling Novelty-Driven Industrial Dynamics with Design Functions: understanding the role of learning from the unknown," Post-Print hal-00696970, HAL.
    5. Cecere, Grazia, 2012. "Creative and adaptive responses in technological change," 23rd European Regional ITS Conference, Vienna 2012 60396, International Telecommunications Society (ITS).

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