Regulation - Case 3
Based on previous academic work we analysed various regulatory scenarios in the context of Next Generation Access (NGA) investment. The scenarios allowed for (1) multiple firms, (2) firm asymmetries, (3) margin squeeze, (4) total welfare assessment and various risk-sharing scenarios. One key finding was that traditional margin squeeze approaches tend to distort NGA investment incentives to the detriment of consumers. Moreover, we found that risk-sharing is likely to benefit consumers compared to traditional Long-Run Incremental Cost (LRIC) approaches.