Pricing in Abundance The Economics of the Manatua Cable
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Keywords
pricing, submarine, traffic, bandwidth, wholesale
Abstract
Small island nations that have relied on satellites for international connectivity are now being connected by submarine cables that have infinitely more capacity. The hope is that these cables will lift the social and economic development of the economies connected. This hope is more likely to be realized with the adoption of wholesale traffic pricing based on the capacity abundance brought by the cable system rather than historical wholesale bandwidth pricing, which assumes capacity scarcity. Reductions in the wholesale cost of international connectivity are more likely to be passed on to end users if there is retail competition. The proposed wholesale pricing model facilitates increased retail competition. These ideas are explored in a case study of the Cook Islands, which is a member of the Manatua Cable Project.
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References
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This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
Copyright Telecommunications Association Inc.
John De Ridder, Independent Telecommunication Consultant
John de Ridder has been an independent telecommunications consultant since 2002. Many of his projects and papers can be found on his website http://www.deridder.com.au.
He is recognized locally and internationally as an experienced telecommunications economist with expertise in broadband pricing and regulation. Clients have included World Bank/ITU (re-writing the competition and price regulation module of the on-line ICT Regulatory Toolkit), OECD (on what drives broadband penetration rates), ISPs in New Zealand (in a bitstream access dispute with TNZ) and TransACT (on its NBN Mark I business case). He is currently advising the incumbent in a neighbouring country on retail pricing.
