Final Report for Department for Business, Innovation and Skills and Department for Culture, Media and Sport


Detailed results from the Wi-Fi offload model



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Detailed results from the Wi-Fi offload model

Figure  B .25 shows a breakdown of the consumer and producer surplus from Wi-Fi offload, and Figure  B .26 shows the results of the sensitivity analysis. The base case assumes that 95% of indoor traffic will be offloaded by 2021, while Scenario 2 assumes a lower estimate of 75%.

Figure B.25: Surplus from Wi-Fi offloading [Source: Analysys Mason, 2012]



£ million

2011

NPV (2012–2021)

Consumer surplus

1 810

24 800–27 900

Producer surplus

25

780–3 130

Direct welfare benefits
(consumer + producer surplus)

1 840

25 600–31 000

Note: all results have been rounded to 3 significant digits.
Figure B.26: Sensitivity analysis of surplus from Wi-Fi offloading (10-year NPVs, 2012–2021) [Source: Analysys Mason, 2012]

£ million

Scenario 1 (base case)

Scenario 2




2011

NPV
(2012–2021)


2011

NPV
(2012–2021)


Consumer surplus

1 810

27 900

1 810

24 800

Producer surplus

25

3 130

25

780

Direct welfare benefits (consumer + producer surplus)

1 840

31 000

1 840

25 600

Note: all results have been rounded to 3 significant digits.

    1. Broadcast TV model

We have built a new model to calculate the consumer and producer surplus from DTT and DTH satellite broadcasting. We have not considered analogue terrestrial broadcasting (since this will cease before the end of 2012) or cable TV (since this does not involve the use of radio spectrum). We have, however, included BT Vision Internet Protocol (IP) TV households in our consumer surplus calculation, since these subscribers still receive broadcast TV channels via DTT. Thus, two main TV segments are considered:

  • DTT (Freeview)136

  • DTH comprising free DTH (Freesat, including Freesat from Sky) and pay DTH (Sky).

The structures of the approaches used to estimate the consumer surplus from DTT and DTH are shown below in Figure  B .27 and Figure  B .28.

Figure B.27: Approach used to estimate the consumer surplus from DTT [Source: Analysys Mason, 2012]



Key: HH = households, MUX = Multiplex


Figure B.28: Approach used to estimate the consumer surplus from DTH [Source: Analysys Mason, 2012]

The structures of the approaches used to estimate the producer surplus from DTT and DTH are shown below in Figure  B .29 and Figure  B .30.



Figure B.29: Approach used to estimate the producer surplus from DTT [Source: Analysys Mason, 2012]

Figure B.30: Approach used to estimate the producer surplus from DTH [Source: Analysys Mason, 2012]






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