Liberalisation

Introducing competition into a market that was formally dominated by a monopoly provider is an area where regulatory economics plays an important role. We have been involved in assessing whether there is the potential for competition within a market; advising on the best way to introduce competition, particularly when it is necessary to safeguard a Universal Service Obligations (USO) that the incumbent may be expected to maintain; and evaluating whether and when competition is sufficient to allow the deregulation of prices within that market.

We have undertaken a number of pieces of work for Postcomm to assess the potential for competition within the UK postal market. This has included developing a model to assess the level of costs a new entrant to the postal market would be expected to have, an assessment of the scope of the price control based on a detailed review of the potential for competition to develop in the markets associated with individual products and an assessment of which postal activities in the postal supply chain would be able to support a number of competing operators, based on the cost characteristics of the activities.

For Ofgem we have undertaken an assessment of the switching behaviour of customers in the electricity supply sector to assess the level of competition within this market. We are advising ten regulatory authorities in the Middle East and North Africa on issues associated with telecommunications liberalisation and have advised a number of other authorities in Europe and the Caribbean on the introduction of competition into the telecoms sector.