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Quantifying the Benefits of Infrastructure Sharing

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  • Matthew Andrews
  • Milan Bradonjic
  • Iraj Saniee

Abstract

We analyze the benefits of network sharing between telecommunications operators. Sharing is seen as one way to speed the roll out of expensive technologies such as 5G since it allows the service providers to divide the cost of providing ubiquitous coverage. Our theoretical analysis focuses on scenarios with two service providers and compares the system dynamics when they are competing with the dynamics when they are cooperating. We show that sharing can be beneficial to a service provider even when it has the power to drive the other service provider out of the market, a byproduct of a non-convex cost function. A key element of this study is an analysis of the competitive equilibria for both cooperative and non-cooperative 2-person games in the presence of (non-convex) cost functions that involve a fixed cost component.

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  • Matthew Andrews & Milan Bradonjic & Iraj Saniee, 2017. "Quantifying the Benefits of Infrastructure Sharing," Papers 1706.05735, arXiv.org.
    • Handle: RePEc:arx:papers:1706.05735
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    File URL: http://arxiv.org/pdf/1706.05735
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    References listed on IDEAS

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    1. Alejandro Saporiti & German Coloma, 2008. "Bertrand's price competition in markets with fixed costs," RCER Working Papers 541, University of Rochester - Center for Economic Research (RCER).
    2. Germán Coloma, 2008. "Bertrand and Price-Taking Equilibria in Markets with Product Differentiation," CEMA Working Papers: Serie Documentos de Trabajo. 369, Universidad del CEMA.
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    Cited by:

    1. Edward J. Oughton & William Lehr, 2022. "Surveying 5G Techno-Economic Research to Inform the Evaluation of 6G Wireless Technologies," Papers 2201.02272, arXiv.org, revised Jan 2022.

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