Classroom Companion: Business

 
Chapter 17 · Digital Markets

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(the crowd) offer transportation services 
to consumers. Uber does not own taxis 
or cars but instead mediates between 
drivers and passengers. Uber is totally 
dependent on the crowd to provide their 
assets (cars) in its business model.
The sharing economy challenges legal 
frameworks, especially labor laws and 
commercial laws. Uber is, for example, 
forbidden in several countries, including 
Norway, Denmark, and Italy, due to vio-
lation of the laws concerning licensing of 
professional taxi drivers (Rhodes, 
2017
). 
Another example is Airbnb having met 
restrictions in, for example, New York 
City where private consumers are not 
allowed to rent out property on a short-
term contract (less than 1 month) when 
the host is not present. The sharing econ-
omy enables consumers to make profits 
off assets they own. Sharing services 
have been criticized as competing under 
different terms than established busi-
nesses by circumventing labor protection 
laws and thereby providing services with 
lower costs compared to services pro-
duced by companies using the in-house 
production model.
17.4 
 Network Access Markets
Network access is offered jointly by the ISP (commercial) and NP (technical). This 
includes access to broadband Internet connections, Wi-Fi, public mobile networks, 
telephone services, and messaging services (e.g., email and SMS/MMS). These ser-
vices are integral parts of the network and do not depend on additional services 
delivered by other stakeholders (e.g., ASPs or content providers).
Network access is a fundamental service—also called a foundational technology—
in the digital economy. This is because the access to and delivery of digital services 
depends on reliable access to the Internet. Reliable access to the Internet is supported 
by a worldwide ICT infrastructure consisting of optical fibers, wireless base stations, 
Internet routers, satellite networks, and other network resources. Users access the 
Internet using personal computers, tablets, set-top boxes, or smartphones. The NP 
owns and operates the physical ICT infrastructure supporting the Internet. This 
includes all kinds of communication networks and associated management systems 
and computing and storage facilities. The ISP buys access to the infrastructure from 
the NP and resells this access to consumers and ASPs.
There are several examples of NPs that are also ISPs. The traditional incum-
bent network operator both owns the communication network and sells telephone 
services to consumers. To ensure fair competition among ISPs, national regulation 
in most countries compels the incumbent network operator to split the business 
operations into two independent parts: one for NP operations and one for ISP 
operations. Several national regulators have also forced the incumbent NP to open 
the ICT infrastructure for ISPs other than the ISP owned by the incumbent. These 
ISPs can lease the ICT infrastructure from the NP on the same terms as the ISP 
owned by the incumbent NP.
ISPs that do not own their own network infrastructure are called virtual net-
work operators (VNOs)—or mobile virtual network operators (MVNOs) if they