Telecommunications and Technology Policy: Internet Economics

Telecommunications and Technology Policy: Internet Economics
BMGT 798V - Section 0101

Spring 2000 Syllabus

Professor Joseph P. Bailey
3419 Van Munching Hall
Robert H. Smith School of Business
University of Maryland
jbailey@rhsmith.umd.edu
phone: 301-405-2174
office hours: 1 hour before each class

This syllabus will change throughout the spring semester.
1999 Syllabus

Course Description

The foundation of this course is an economic understanding of the dramatic change in the market with to the introduction of the Internet. The course material spans the many layers of the Internet starting with the economics of the Internet's infrastructure and ending with the international aspects of Internet commerce. The course is designed for advanced MBA students who have a particular interest in telecommunications, electronic commerce, and information technology. Some of the topics that will be addressed in the class include:

Economics of electronic commerce.
Structure of the Internet, telecommunications, and related technology industries.
Economics and public policy of the Internet.
Convergence of computing, communications, and content.
Regulation and deregulation of telecommunications.
Antitrust and technology policy.
Impact of technology policy of the diffusion of innovations.

Meeting Times

Mondays and Wednesdays from 2:00pm- 3:15pm in Van Munching Hall, room 1303.

Required Texts

There are two texts for the class:

Hudson, Heather. Global Connections, 1998.
Shapiro, Carl and Hal Varian. Information Rules, Harvard Business School Press, Boston, 1998. (which is also available at Amazon.com).

Furthermore, there will be a course reader which will include all the additional readings for the semester.

Optional Texts

You may want to supplement the course reader with one or more of the following books depending upon the topics you are most interested in. For those interested in general economic texts, you may want to refer to:

Enterprise, Government, and the Public by Stephen J. K. Walters.
Managerial Economics by Edwin Mansfield.

For those interested in telecommunications history, politics, and policy:

Technologies of Freedom by Ithiel de Sola Pool, Harvard University Press, 1983.
The Gordian Knot: Political Gridlock on the Information Highway by W. Russell Neuman, Lee McKnight, and Richard Jay Solomon.

For those interested in economics, business, telecommunications and the Internet:

The Death of Distance: How the Communications Revolution Will Change Our Lives by Frances Cairncross, Harvard Business School Press, 1997.
Internet Economics edited by Lee W. McKnight and Joseph P. Bailey.
Designing Incentive Regulation for the Telecommunications Industry by David E. M. Sappington and Dennis L. Weisman.

Course Requirements

The course has four grading elements: a technology briefing, a final presentation/paper, a final exam, and class participation. The final presentation/paper is on a topic of the student's choosing, but it must be approved by the instructor. Students will be asked to propose a topic of their choosing around the mid-point of the semester. The final exam will address the cumulative material of the course and will test students' thinking an integration of ideas. Finally, class participation is an important aspect of the class. Students can help their class participation grade by regularly attending class, preparing for class, and participating in class discussions.

Technology Briefing 15%
Final Projects 30%
Final Exam 30%
Class Participation 25%

Course Feedback

I welcome any feedback from students throughout the semester regarding course content and the presentation of material. Please feel free to send me email or use the following form to send me feedback anonymously.

Course Calendar

Sunday	Monday	Tuesday	Wednesday	Thursday	Friday	Saturday
January 30	Course Overview 31	February 1	Structure of the Telecom Industry (1) 2	3	4	5
6	Structure of the Telecom Industry (2) 7	8	Structure of the Telecom Industry (3) 9	10	11	12
13	Telecom History and Law 14	15	Telecom Liberalization and Privatization (1) 16	17	18	19
20	Telecom Liberalization and Privatization (2) 21	22	Technology and Competition in the Local Loop 23	24	25	26
27	Technology Briefings (Students) 28	29	March Electronic Commerce (1) 1	2	3	4
5	Electronic Commerce (2) 6	7	Electronic Commerce (3) 8	9	10	11
12	Internet Economics (1) 13	14	Internet Economics (2) 15	16	17	18
19	*Spring Break* 20	---------------- 21	---------------------- 22	------------------- 23	*Spring Break* 24	25
26	Economics of Standards 27	28	Convergence 29	30	31	April 1
2	Intellectual Property 3	4	Antitrust 5	6	7	8
9	Interconnection, Competition, and Global Networks 10	11	Global Alliances 12	13	14	15
16	Diffusion of Innovations 17	18	Technology Forecasting 19	20	21	22
23	Government and Technology (1) 24	25	Government and Technology (2) 26	27	28	29
30	May *No class (ELM conflict)* 1	2	*No class (ELM conflict)* 3	4	5	6
7	Student Presentations (1) 8	9	Student Presentations (2) 10	11	12	13
14	Telecom, Technology, and the Global Market (Last class) 15	16	17	18	Optional Review & Hand in Projects 19	20
21	Final Exam 22	23	24	25	26	27

Course Schedule

January 31, 2000: Course Overview

Topics	Readings	Links
Structure of the Course Grading	None	Telecom Information Resources on the Net UMD's Virtual Business Information Center

February 2, 2000: Structure of the Telecommunications Industry (1)

Topics	Readings	Links
Non-competitive telecom markets Incumbent Local Exchange Carriers (ILECs) Local Access Transport Areas	Hudson, Chapters 1 & 2	Ameritech Bell Atlantic BellSouth GTE SBC Communications USWest

February 7, 2000: Structure of the Telecommunications Industry (2)

Topics	Readings	Links
Semi-competitive telecom markets Interexchange carriers	Hudson, Chapter 3	AT&T MCIWorldcom Sprint

February 9, 2000: Structure of the Telecommunications Industry (3)

Topics	Readings	Links
Competitive telecommunication markets Competitive LECs	Hudson, Chapter 4	Level 3 Qwest Williams Communications

February 14, 2000: Telecommunications History and Law

Topics	Readings	Links
U.S. history of AT&T Development of PTTs abroad	Hudson, Chapter 5	Telecommunications Act of 1996

February 16, 2000: Telecommunications Liberalization and Privatization (1)

Topics	Readings	Links
Definitions of Liberalization and Privatization Examples	Hudson, Chapter 6 & 7	World Trade Organization

February 21, 2000: Telecommunications Liberalization and Privatization (2)

Topics	Readings	Links
Case study on Argentina	Hudson, Chapter 8	none

February 23, 2000: Technology and Competition in the Local Loop

Topics	Readings	Links
Why the local loop is a bottleneck Alternative and competing technologies	none	OECD Report on Local Loop Technologies Cable Data News

February 28, 2000: Technology Briefings

Topics	Readings	Links
Student Presentations	None	Technology Briefing

March 1, 2000: Electronic Commerce (1) - Economics and Markets

Topics	Readings	Links
Intermediation and disintermediation Markets and hierarchies	Shapiro & Varian, Chapter 1	none

March 6, 2000: Electronic Commerce (2) - Changes in the Supply Chain

Topics	Readings	Links
Guest lecture - Elliot Rabinovich, University of Maryland How scope and scale is changing in the supply chain	Shapiro & Varian, Chapter 2	none

March 8, 2000: Electronic Commerce (3) - Developing Business Strategy

Topics	Readings	Links
Guest lecture - Oliver Yao, University of Maryland How firms can differentiate themselves	Shapiro & Varian, Chapter 3	TBD

March 13, 2000: Internet Economics (1) - Industry Structure

Topics	Readings	Links
Analysis of ISP competition Decentralized nature of the Internet	Shapiro & Varian, Chapter 7	TBD

March 15, 2000: Internet Economics (2) - Pricing

Topics	Readings	Links
Guest lecture - John Schnizlein, Cisco Metering the Internet	MacKie-Mason and Varian, "Economic FAQs About the Internet"	TBD

March 27, 2000: Internet Economice (3) - New Services

Topics	Readings	Links
De jure vs. de facto standards Economic benefits of standardization vs. path dependency	none	TBD

March 29, 2000: Convergence

Topics	Readings	Links
Guest lecture - Doug Melcher, Paul, Weiss, Rifkind, Wharton, and Garrison	Shapiro & Varian, Chapters 5, 6, & 8 The FCC and the Unregulation of the Internet	MIT Internet Telephony Consortium Alliance for Converging Technologies

April 3, 2000: Intellectual Property

Topics	Readings	Links
Structure of the Course Grading	Shapiro & Varian, Chapter 4	none

April 5, 2000: Antitrust

Topics	Readings	Links
Microsoft case HHI calculations	Shapiro & Varian, Chapter 10	none

April 10, 2000: Interconnection, Competition, and Global Networks

Topics	Readings	Links
Interconnection asymmetries International settlements	Hudson, Chapters 14 & 15	International Telecommunications Union

April 12, 2000: Global Alliances

Topics	Readings	Links
Structure of international joint ventures by telecommunication carriers	Hudson, Chapters 16 & 17	Global One

April 17, 2000: Diffusion of Innovations

Topics	Readings	Links
Structure of the Course Grading	Farrell and Saloner, "The Economics of Standards: Horses, Penguins, and Lemmings"	TBD

April 19, 2000: Technology Forecasting

Topics	Readings	Links
Structure of the Course Grading	Shapiro & Varian, Chapter 9	Internet Resources for Forecasting and Demand Analysis

April 24, 2000: Government and Technology (1)

Topics	Readings	Links
The many roles in U.S. Government technology Policy Structure of U.S. government Foreign technology policy structure	TBD	TBD

April 26, 2000: Government and Technology (2)

Topics	Readings	Links
DARPA perspective on technology funding	TBD	U.S. Information Infrastructure Task Force

May 8, 2000: Student Presentations (1)

Topics	Readings	Links
Structure of the Course Grading	none	none

May 10, 2000: Student Presentations (2)

Topics	Readings	Links
Structure of the Course Grading	none	none

May 15, 2000: Telecommunications, Technology, and the Global Market

Topics	Readings	Links
Integration of course material Projecting the future of the telecom and technology landscape	Hudson, Chapter 18	none

May 17, 2000: Final Papers Due - Optional Review Session

when: TBD where: TBD

May 18&19, 2000: Final Exam, Take away