Modeling High-Tech Deployment in International Environments for Effective Policy-Making

1. Modeling High-Tech Deployment in International Environments for Effective Policy-Making DHP P232 / ESD.127 Telecommunications Modeling and Policy Analysis January 30th, 2002

2. Agenda • What is a model and how good is a model? • Why do we care for technology-based models? • Building up a cost model: architectural principles • Using your model effectively for policy-making • What your model should aim at – research question • What your model should have (T+B+P)

3. What is a model? • An abstraction of reality: “…something used to explain some phenomena to other people in a way they can understand it…” • A very old and often used model: “it usually rains when the sky is cloudy” • Expressed in a proper language: • To capture “emergent behavior” • To explain “principal components” • To raise understanding about “driving forces”

4. How good is a model? • A good model is one that satisfactorily: • meets a goal • answers a research question • creates knowledge upon the assumptions • Bad model  Uncertain: • uncertainty is a characteristic of a model • Types of models (by purpose): • Descriptive: capture the “state-of the art” • Prospective: predict the future state of the model • Supportive: aimed at justifying action

5. Where are we? • In this course, we care for “telecommunications modeling” “all models” “engineering models” DHP P232 ESD.127 “telecommunications models” New telecommunication technologies in international business environments

6. Technology-based cost models • New technology: • little knowledge about architecture • careful extrapolation of historical data on similar technologies • Cost models: • equipment costs “easy” to define and obtain • poor idea of elasticity of demand, no idea of revenues • impossible to characterize equilibrium and shifts • Types of costs: • capital, operational, maintenance, SM&A • “green-field”, “forward-looking”

7. Building-up a cost model • Looking at previous projects: • Set the stage: • assumptions, research question, build intuition • Architecture: • block diagrams and scenarios • Implementation: • modeling tool and getting data • Analysis: • answer question • develop further • Map this to your syllabus…

8. A few architectural principles • Bottom up vs. top down: • Define business environment, assess technological needs and plug-in technologies • Define technology, assess business conditions and design deployment strategies • Complexity: how should you spend your time? • Robustness: reaction to perturbations • Modularity: define interfaces! d a t a a r c h X+X Y+Y

9. Using your model • Discuss validity of assumptions • Discuss weaknesses of the model • Present ideas for improvement • Use sensitivity analysis from a base scenario: X1 X2 X3 Y=f(X1,X2,X3) Base scenario “Tornado” diagram

10. Model to answer research questionInclude technology, business and policy characteristics • Model towards the research question: • Keep objective in mind, do not waste energy, mainly in getting the data! • Include all dimensions of analysis and praise multi-disciplinarity: • DHP P232/ESD.127 = Learning environment! policy An example: “Wireless Leapfrogging in Africa” Fletcher + TPP technology business