Broadband Price Diversity: Good for Adoption?

Is price diversity a bad thing for consumers or does it foster broadband take-up, especially by laggards? Academic research finds that tariff diversity is a driving factor for broadband adoption and does not impede take-up. Based on a rich original dataset with more than 10,000 residential retail broadband offers for 23 European states between 2003 and 2011, my research found that broadband demand is positively related to increased tariff diversity, especially in the presence of inter-platform competition. This result confirms my previous research, conducted with my PhD supervisors using data from 82 countries in 2012. These results suggest that demands by some public interest groups to limit price discrimination in broadband markets should be viewed with caution. Such limits may come at the cost of reduced numbers of subscribers and work against the goals of national broadband strategies that aim to promote broadband adoption and the take-up of next generation Access networks. [Mirjam Lange is a PostDoc at University of Frankfurt, Germany]