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EXPLORING LOCATIONAL EQUILIBRIA IN A COMPETITIVE BROADBAND ACCESS MARKET: THEORETICAL MODELING APPROACH
Author(s) -
Lee Gunhak,
O'Kelly Morton E.
Publication year - 2009
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/j.1467-9787.2009.00609.x
Subject(s) - broadband , competition (biology) , probabilistic logic , market share , industrial organization , competitive advantage , business , computer science , microeconomics , telecommunications , economics , marketing , artificial intelligence , ecology , biology
Due to strong local competition in the broadband access market, strategic locational planning is very important for service providers. In this paper, we explore locational equilibria in a competitive broadband market under several situations: with and without customer loyalty and under different initial market conditions. To do this, we propose a competitive broadband location model based on probabilistic patronage behavior, explicitly considering the characteristics of the broadband market and competitive structures. Also, we suggest iterative algorithms to identify spatial equilibria. We show that competing location strategies may lead to a stable spatial configuration of market share.