Energy markets need to be backed up by a suite of system services, such as reserve and stability services, to ensure that the energy system can function reliably. The Single Electricity Market Committee (SEM-C) in Ireland needs to procure availability of system services by offering contracts with both short and long durations, to cater for existing capacity and encourage investment.

We were commissioned by the SEM-C to come up with auction rules suitable for a high level framework it had already set out. Our report covered specific provisions of these rules, such as ‘package bidding’ to help bidders manage risk, as well as the contractual obligations that help tie in the systems services with related markets, and is available here.

E-commerce presents consumers with a broad range of suppliers that they can search between much more easily than they could by visiting brick and mortar establishments. However, it also allows these suppliers to collect data on consumers that they might use for new forms of price discrimination or lead to tacit collusion through algorithmic pricing.

Competition authorities need to consider whether their existing frameworks can address e-commerce cases. We examined trends in the adoption of e-commerce for the Competition Commission of Singapore and argued that existing frameworks can cope with these cases, provided authorities are aware of the new competition risks and benefits that arise from e-commerce. The report is available here.

Many of the services that are available apparently ‘for free’, are in fact paid for by the data their users provide. Consumer data collected by businesses have become a key asset in the digital economy.

Understanding how businesses go about collecting consumer data and how they use it is important to asses how these practices affect consumers, businesses, competition and the wider economy.

As part of its wider project to understand the role played by consumer data, the Competition and Markets Authority (CMA) commissioned us to examine the commercial use of consumer data three sectors that together cover a variety of digital business models – motor insurance, clothing retail and gaming applications (apps).

The report summarising our findings is available here and can also be downloaded from the CMA’s website.

The effective management of radio spectrum by telecoms regulators involves careful consideration of when, and how, spectrum is made available to operators. The Irish telecommunications regulator, ComReg, asked DotEcon to set out the key factors affecting the potential award of spectrum in the 2.6 GHz band, with the possible inclusion of the 700 MHz, 1.4 GHz, 2.3 GHz and 3.6 GHz bands.

Our report considers the suitability of awarding the bands simultaneously, alternative options for the award and the design of an auction process, competition safeguards, licence conditions, and methodologies for structuring licence fees.

ComReg subsequently awarded the 3.6 GHz band in a separate process, with the 700 MHz, 2.3 GHz and 2.6 GHz included (alongside new 2.1 GHz licences) in a later multi-band award (the ‘MBSA2‘). We supported ComReg in both awards with design and implementation services.

The award of 800 MHz (digital dividend) spectrum in Denmark included onerous coverage obligations, designed to improve availability of 10Mbps services in areas where coverage was poor.

The national coverage target was split into three regional obligations that were by default attached to the lots on offer. However, the auction included the novel approach of allowing bidders to bid for exemptions from the coverage obligation in some or all regions, with the restriction that the supply of exemptions for each region could be at most one less than the number of winning bidders. This maximised the chances of assigning every coverage obligation, whilst giving some flexibility for bidders to share the burden between them.

This approach to including coverage obligations in auction design was presented by DotEcon at the 2014 Latin America Spectrum Management Conference in Rio de Janeiro. The presentation is available here.

Following completion of the UK 4G spectrum award, Ofcom sought to revise the annual licence fees (ALFs) for licences in the 900 MHz and 1800 MHz bands to better reflect the value of the spectrum. To support Ofcom with determining the appropriate level at which to set the ALFs, DotEcon prepared a report examining evidence on the value of the relevant bands in other jurisdictions.

In particular, DotEcon used comparable spectrum prices reached in auctions across other countries, renewals fees for licences and spectrum values realised in secondary trading to estimate value ranges.

We used a similar methodology to advise Ofcom in the design and implementation of a methodology to calculate band-specific proxy prices for the 800MHz and 2.6GHz bands from the package prices of the 4G auction. Our implementation report comparing the linear reference price methodology (LRPM) and the addition spectrum methodology (ASM), and providing the price estimates resulting from their applications can be downloaded here.