Is The Canadian Cable Television Industry a Natural Monopoly :: essays research papers

ChapterOutline come beforeChapterTitle knavePrefaceOutline1I design2AThe Canadian Cable Television Industry2IIDetails3AModel3BData4 popular chordExternality Effect10IIIComparison with Telephone Industry12IVReferences14 put backTitlePage1.12003 Market Share of Canadian Cable Companies.22.1Canadian Cable Industry52.2Rogers Communications incorporation72.3Shaw Communications Incorporation82.4Cogeco Cable Company93.1 peripheral Private Benefit113.2Marginal Private Cost113.3Demand Schedule of the market12FigureTitlePage1.12003 Market Share of Canadian Cable Companies.22.1Conventional flick of Natural Monopoly42.2Measurement of Possibility of Natural Monopoly52.3Canadian Cable Television Indusry62.4Rogers Communications Incorporations72.5Shaw Communications Incorporation82.6Cogeco Cable Company103.1Externality Effect of order of Cable Industry12ChapterIntroduction1A. THE CANADIAN personal line of credit TELEVISION INDUSTRYIt all started back in 1981 when Vidotron Lte and La Presse in troduce the first electronic news melodic theme via cable in Montreal. adept year later, The Canadian Radio- idiot box Commission licensed Canadas first pay run and 58% of home telecastings were connected to the cable television.The majority of industry members put one everywhere formed an association the CCTA Canadian Cable Televisions Association, to have a interrelated word when facing regulators, help promote the industrys services. circuit board 1.1 and figure 1.1 show that CCTA have through its members a control over more than 70% of the Canadian cable services.Table 1.1Market assure (2003)ROGERS 30.30%SHAW 27.20%COGECO 11.20%EASTLINK 3.20%ACCESS 1.00%MONARCH 0.80%OTHER* 26.40%TOTAL 100%*less than 50,000 customers for each oneFigure 1.12003 Market share of Canadian Cable CompaniesSince its inception, cable television service has been subject of substantial intervention on the part of regulators in Canada. The Cable television operators are licensed by a wiz federal regulatory authority, the CRTC. It classifies Licensed Service Areas (LSA) based partly on the current subscription level within the LSA and partly on the quality of air out reception available to the service provider.The issues to be addressed in this paper are the following&61607Was the enforced monopoly provision of basic cable television justified?ChapterDetails2A. MODELWhen a monopoly occurs because it is more in force(p) for one firm to serve an entire market than for two or more firms to do so, because of the sort of economies of scales available in that market. A common example is water distribution, in which the main cost is laying a network of pipes to deliver water.One firm can do the work at a lower average cost per customer than two firms with competing networks of pipes. Monopolies can arise abnormally by a firm getting sole ownership of a resource that is essential to the production of a good or service, or by a government granting a firm the legal right to be t he sole producer. Other unnatural monopolies occur when a firm is much more efficient than its rivals for reasons new(prenominal) than economies of scale.