ENTS 631
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Professor Joseph P. Bailey 3411 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 class or by appointment |
Course Information
Course DescriptionThe telecommunications and related technology industries are extraordinarily dynamic. Rapid changes in technology and exponential market growth are the norm. Accordingly, there are also changes in industry structure, competitive dynamics, and public policy. Although historically the telecommunication industry were essentially closed to competition through government grants of monopoly franchises, competition is now replacing regulation. However, this does not remove government as an important player in telecommunications and technology industries. In fact, public policy is still an important factor in shaping telecommunications. This course will focus on some of the interesting and complex questions regarding telecommunications and technology policy.The course introduces the economic tools to understand markets and competition at the at the inter-firm and industry level. This includes an identification of markets and market failure which sometimes propels the intervention of the government. Furthermore, issues of antitrust and game theory are introduced. The course then builds on the economic tools by exploring issues of telecommunications and technology policy. This includes an examination of the politics of telecommunications, the liberalization and privatization of telecommunication companies, the introduction of the Internet and electronic commerce, the issues surrounding intellectual property, and global competition and alliances. The format of the course will include lectures, class discussion, and presentations by students. In addition, the course will bring in a number of guest speakers.
Required TextsThere are two required texts for the class along with some additional readings which will be distributed in class. Since the study of telecommunications and technology policy is so dynamic, students are required to keep up with current events by reading a publication of their choice.
Optional TextsThere are a number of optional readings which will be cited or linked to this class Web page. Whenever possible, the class will try to use the resources on the Web to reduce the amount of photocopying. Finally, there are two textbooks that are used repeatedly throughout this class for optional readings.
Course RequirementsThere are three elements to the course which determine the student's grade: final paper, final exam, and class participation. The final paper will address an alliance in the telecommunications and/or technology industries which has global implications and inherent public policy issues. Some suggestions include examination of World Partners, Concert, or SBC's proposed purchase of Ameritech (because of our guest and discussion on GlobalOne, a final paper about the GlobalOne alliance will not be permitted). The Final exam will be administered during the exam week in December and will be in short answer and essay format. The exam will cover all the entire scope of the class. Finally, class participation is an important component for a successful class. Regular attendance along with proper class preparation results in a much better class discussion and higher marks for the student.
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Course Schedule
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August 31, 1998 |
Introduction: Markets and Market Failure[Bailey]DescriptionThis class will provide a basic overview of the course describing the scope and philosophy of the course as well as the course requirements. The idea of a market is then introduced along with the problems of a market failure. One possible mechanism of preventing market failure--the participation of the government in a market--is described. This provides a foundation for future discussion of business and public policy.
Readings
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September 7, 1998 |
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September 14, 1998 |
Market Structure, Horizontal and Vertical Integration[Bailey]DescriptionA brief introduction of the theory of the firm is used to describe how market relationships differ from intra-firm transactions. This includes the definition of a monopoly, oligopoly, and perfect competition for a market structure. The ability of a firm to vertically or horizontally integrate themselves to achieve economies of scope and scale is discussed as a competitive strategy.
Readings
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September 21, 1998 |
Designing Industrial Structure for Deregulation[Carolyn Berry, Federal Energy Regulatory Commission]DescriptionThe line that is drawn between regulated and unregulated markets continues to change as technology advances and policy changes. This class will introduce the strategies policy makers use to design market structures so they do not have to regulate them. This includes a brief introduction of what regulation and the introduction of case examples where regulation may not be necessary.
Readings
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September 28, 1998 |
Antitrust and Monopolization[Bailey]DescriptionWe will discuss the Federal Trade Commission and the Department of Justice as well as other non-US governmental bodies which enforce laws to prevent non-competitive behavior by companies. The class will discuss the Microsoft, AT&T, and IBM cases of antitrust government activity.
Readings
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October 5, 1998 |
Game Theory[Bailey]DescriptionThe use of game theory is introduced to describe why some market structures change the nature of the benefits to consumers.
Readings
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October 12, 1998 |
Politics and Technology Convergence[Bailey]DescriptionHow firms can position themselves differently than their competitor to achieve an advantage is discussed.
Readings
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October 19, |
Telecommunications Liberalization and Privatization[Bailey]DescriptionThe movement of the telecommunications industry from publicly owned or regulated companies to competitive firms is described within the process of liberalization and privatization. The introduction of the Telecommunications Act of 1996 and the World Trade Organization agreement to introduce competition in telecommunications is discussed.
Readings
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October 26, 1998 |
Satellites, International Cooperation, and the ITU[Bailey]DescriptionThe roles of international bodies in the creation of telecommunication policy is discussed with an emphasis on the role of the International Telecommunications Union (ITU). The role of international settlements and the opportunities for emerging markets to experience double-digit telecommunications growth is discussed. The use of satellite technology and satellite policy is also discussed.
Readings
Links
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November 2, 1998 |
Intellectual Property and International Trade[Jeffrey Cunard, Debevoise & Plimpton, and Bailey]
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November 9, 1998 |
Electronic Commerce and Price Discrimination[Bailey]DescriptionWe will discuss the growing importance of electronic commerce for intra- and interorganizational transactions to support a growing global economy. With our guest speaker, we will explore some applications of electronic commerce and the competitive environment of the Internet. In the second part of the class, we will discuss setting prices for consumer product on the Internet with examples coming from the software, compact disc, and book markets. A specific example of setting prices dynamically on the Internet brings us into a discussion on the economics and competitive strategy of price discrimination.
Readings
Links
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November 16, 1998 |
Global Competition and New Technology
[Bailey]
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November 23, 1998 |
Industrial and Technology Policy[Dean Howard Frank, and Bailey]
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November 30, 1998 |
Consolidation and Global Alliances[Stu Mathison, formerly with GlobalOne, and Bailey]DescriptionThe class addresses the ability for international partnerships to be formed among telecommunication carriers and how the alliance structures affect service offerings. The extremes of alliances include outright ownership of partners such as the SBC purchase of PacBell and proposed purchase of Ameritech. Other relationships, such as the World Partners alliance, require no equity.
Readings
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December 7, 1998 |
Student Presentations[Students]DescriptionThe class will present a brief summary of their final papers in the class. The idea of the presentation is to share ideas and learn from fellow students' investigations.
Readings
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December 11, 1998 |
Final Papers Due No Later Than 5pmOptional Review Session from 4:00pm - 6:00pm in Van Munching 3327Study Sheet |
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December 14, 1998 |
Final Exam |
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