Research Update

Winter 2010

Greetings! We bring you research news from the Public Utility Research Center (PURC) at the University of Florida. Our electronic newsletter is designed to keep utility regulators, policymakers, and infrastructure managers informed of our research activities. We invite you to join our mailing list and receive our bulletins by email.


Newly Added "Frequently Asked Questions" to the Body of Knowledge on Infrastructure Regulation

New on this site:

Market Structure, Foundations of Regulation, and Tariff Design are the topics of the latest FAQs on the Body of Regulation website that provides resources for capacity building and policy analysis in the field of infrastructure management and regulation.

Additional FAQs address issues such as pricing to promote access for the poor and governance/regulatory issues associated with state-owned and privately-owned operators. In addition, the material emphasizes the need for cooperation between sector regulators and other agencies.


SSRN Top 10 Paper: Business Separation in Telecommunications: Lessons from the U.S. Experience

Structural and functional separation of telecommunications operators is being considered in many parts of the world following the U.K. adoption of Openreach.

The attractiveness of separation is understandable, but separation in practice rarely if ever lives up to its promises. These experiences show that business separation lowers efficiency and delays innovation, that adapting separation rules to an ever changing industry is costly and creates controversies, that rivals try to gain strategic advantage through the regulatory process, and that behavioral rules are generally more effective in facilitating competition and innovation than structural rules. Read the paper, "SSRN Top 10 Paper: Business Separation in Telecommunications: Lessons from the U.S. Experience".


Characterizing the Efficiency and Effectiveness of Regulatory Institutions

This study briefly surveys contributions to our understanding of performance-drivers in infrastructure sectors. One task facing analysts and policy-makers involves evaluating the impacts of particular features of regulatory institutions.

Here, particular attention is given to methodologies for evaluating regulatory agencies, since regulatory governance is one of the key factors influencing sector outcomes. There is strong evidence that regulatory institutions matter, as studies find positive links. Read the paper, "Characterizing the Efficiency and Effectiveness of Regulatory Institutions".


Conservation and Drought Water Rates: State-of-the-Art Practices and their Application

As Florida continues to balance the need for growth with protection of its natural resources, scientists and policy makers look more closely at the problem of balancing water use and water resources available.

Two approaches can be used by water managers to achieve this balance. The first is supply increase through the use of traditional or alternative water sources. The second approach is water demand management, which focuses on increasing water use efficiency and water conservation in the short and the long term. Read the paper, "Conservation and Drought Water Rates: State-of-the-Art Practices and their Application".


Liberalization and Regulation of Telecoms, Electricity, and Gas in the United States

Focusing on energy and telecommunications, this paper examines the development and evolution of utility regulation in the United States and draws lessons for the future.

It begins with the development of the energy and telecom sectors, taking as given the traditions, institutions, and legal frameworks created through the regulation of transportation and other industries. It describes the economic and political context for regulation and then examines regulation for each sector. It concludes with a brief review of emerging issues. Read the paper, "Liberalization and Regulation of Telecoms, Electricity, and Gas in the United States".


Analyzing Telecommunications Market Competition: A Comparison of Cases

This paper presents three case studies regarding the assessment of market competition in telecommunications.

The three cases include the finding by the U.S. Federal Communications Commission that AT&T was non-dominant in the U.S. long distance market in the early 1990s; the finding by Ofcom in the United Kingdom that each mobile network operator possessed significant market power for the termination of calls to its subscribers; and Japan's development of pro-competitive policies for its telecommunications markets. Read the paper, "Analyzing Telecommunications Market Competition: A Comparison of Cases".


Reset for Regulation and Utilities: Leadership for a Time of Constant Change

This paper describes a process of change for regulation and utilities in today's dynamic and uncertain environment.

Using the concept of "reset", which means that developing fresh perspectives and knowledge about the future, all the while holding in trust the wisdom of the past, the paper examines three juxtapositions. The first is to focus on next practices, not best practices. Best practice is about following in someone else's footsteps, whereas next practice is about going into areas where no one has gone before. The second is focusing on why rather than focus on what. Asking "What should we do next?" emphasizes practice whereas asking "Why have certain practices been successful?" searches for underlying needs and context. The third juxtaposition is between leading and leadership. A leader provides direction, which is proper when the right direction is known. In contrast leadership mobilizes people to tackle difficult and often ambiguous problems and circumstances. Read the paper, "Reset for Regulation and Utilities: Leadership for a Time of Constant Change".


Dumbing Down the Net: A Further Look at the Net Neutrality Debate

The provision of and charging for premium transmission speed of Internet packets consistently appear in the public debate.

Proponents of net neutrality argue that the network should be nothing more than infrastructure that adds no value to the service. Thus, innovation should occur only at the edges of the network. Net neutrality advocates also hold that the network should be a commons that broadband users are allowed to use in ways that are not illegal and that do not harm the network and that networks should not discriminate between uses, users, and content. In contrast, network providers such as AT&T argue that offering premium transmission services will improve customer choice and that ISPs would not degrade service to content providers not purchasing the premium transmission speed. Read the paper, "Dumbing Down the Net: A Further Look at the Net Neutrality Debate".


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