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Procuring NGA infrastructure: The performance of EMAT auctions in Italy
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Procuring NGA infrastructure: The performance of EMAT auctions in Italy

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  • Matteucci, Nicola

Abstract

Italy was a patent laggard in the market roll-out of NGA networks. In 2015, the Italian Government introduced the “ultrabroadband strategy”, an ambitious policy agenda addressing the NGA market failures. This paper assesses the procurement policy assigning public concessions to build and manage passive infrastructure in “NGA white areas”: in detail, the techno-economic properties and outcomes of the auctions are analyzed, both theoretically and empirically. Because the applicable procurement law was the EU one, the EMAT scoring rules were mandatory. Relevant findings stand out, which confirm the received wisdom on first-price auctions, and extend it to high-tech sectors, where EMAT remains under-researched. First, the concession auctions unleashed vibrant bidding competition in many white areas, which enabled substantial budget savings. Second, the quality scoring rules provided adequate flexibility to prioritize the procurement of the most innovative and pro-competitive architectures (FTTH/B/P), despite the presence of high uncertainty. Third, the EMAT framework catered for a multidimensional procurement agenda; the latter targeted efficient and innovative procurement, universal service and higher market competition, while accommodating the ambitious industrial policy of the Government. Evidence of a potential trade-off between the plan implementation delay and its innovativeness emerged; such a conflict was eventually exacerbated by the bandwidth shortages generated by the COVID-19 crisis. By providing the very first study on EMAT auctions for broadband, this work stimulates future comparative research on additional EU member States.

Suggested Citation

  • Matteucci, Nicola, 2021. "Procuring NGA infrastructure: The performance of EMAT auctions in Italy," Telecommunications Policy, Elsevier, vol. 45(1).
    • Handle: RePEc:eee:telpol:v:45:y:2021:i:1:s0308596120301646
    DOI: 10.1016/j.telpol.2020.102074
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    1. Lee, Hyeongjik & Jeong, Seonkoo & Lee, Kwanghee, 2023. "The South Korean case of deploying rural broadband via fiber networks by implementing universal service obligation and public-private partnership based project," Telecommunications Policy, Elsevier, vol. 47(3).

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    More about this item

    Keywords

    NGA; Public procurement; EMAT/MEAT; First-price sealed-bid auction; Market competition; Industrial policy;
    All these keywords.

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • H57 - Public Economics - - National Government Expenditures and Related Policies - - - Procurement
    • L44 - Industrial Organization - - Antitrust Issues and Policies - - - Antitrust Policy and Public Enterprise, Nonprofit Institutions, and Professional Organizations
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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