Proactive price regulation for upgrading telecommunications infrastructure

A mathematical, proactive model has been developed in determining the desirable time for telecommunication firms to upgrade their network infrastructure. The proposed framework uses a static pricing policy to specify the the additional revenue a firm will be allowed after the infrastructure enhancements. Several parameters, including cost and demand considerations, must be carefully analyzed before an optimal timing is determined. Typically, network upgrading is beneficial if costs of initiating infrastructure development is low and demand for it is high.