5G as a Broadband Market Entrant Thomas W. Hazlett H. H. Macaulay - - PowerPoint PPT Presentation

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5G as a Broadband Market Entrant Thomas W. Hazlett H. H. Macaulay Endowed Professor of Economics ACCC/AER Conference Brisbane, Australia August 1-2, 2019 Amazing Technology, no? 8.1.19 ACCC/AER Conf. * Brisbane 2 When was cellular

SLIDE 1

5G as a Broadband Market Entrant

Thomas W. Hazlett

H. H. Macaulay Endowed

Professor of Economics

ACCC/AER Conference Brisbane, Australia August 1-2, 2019

SLIDE 2

Amazing Technology, no?

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SLIDE 3

When was cellular telephony invented?

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SLIDE 4

July 28, 1945

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SLIDE 5

New apps anticipated immediately following World War II

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SLIDE 6

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SLIDE 7

July 28, 1984

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SLIDE 8

Delay via the Political Spectrum

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SLIDE 9

The Political Spectrum: The Tumultuous Liberation of

Wireless Technology, from Herbert Hoover to the Smartphone (Yale, 2017)

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SLIDE 10

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SLIDE 11

Liberal Spectrum Policies

lowering costs of entry and expansion
Australia has been a policy leader

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SLIDE 12

Liberalization early and often

USA: G-fights

– Arguments over ‘is it really 5G?’ – Kudos to policy makers

5G in the Business Start-up Cemetery

– mmW deployments on remnants of Winstar, Teligent, SpeedUS – flexible-use rights just laying around

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SLIDE 13

Intermodal Rivalry

in 2003, arguments over fixed-to-mobile sub
voice calls fled to mobile even as debate raged

– As of 2009, 3X mobile to fixed voice calls, THE ECONOMIST (Dec. 29, 2010).

Today, only half of USA HHs have fixed voice

– NPR.org (May 4, 2017).

20% of U.S. HHs now “smartphone only”

– Phil Britt, Pew: Smartphone-Only Homes Grow, Now 1 in 5 Use Smartphones Exclusively for Internet Access, TELECOMPETITOR (May 1, 2018).

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SLIDE 14

Temptation of Bypass in U.S.

Parsimonious broadcast TV licensing in 1952

– just 3 commercial networks

“spectrum in a tube” – cable TV
U.S. suppressed cable, c. 1962-1980

– Broadcast would always be primary platform – Cable would “siphon” viewers and drain revenues – Risking loss of news and public affairs

Wrong on 2.5 counts

– large VHF stations lost, small UHF stations gained

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SLIDE 15

Australian Broadband Penetration

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SLIDE 16

OECD Broadband Rankings (12.2013)

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OECD Broadband Rankings (12.2018)

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5 10 15 20 25 30 35 40 45 50 55

DSL Cable Fibre Satellite Fixed wireless Other

OECD Fixed broadband subscriptions per 100 inhabitants, by technology, December 2018

SLIDE 18

Declare Victory and Go Home

Superior to pumping by protection
5G is a broadband competitor

– with multiple networks

Should be manna from regulatory heaven
US FCC first determined cellular a “natural

monopoly”

– and unsustainable as an independent firm (1970)

Don’t misunderestimate competition

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SLIDE 19

Thank You.

Please send corrections, criticisms, plaudits,

shout-outs, missing data and helpful citations to: hazlett@clemson.edu

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