s are concerned about how many other consumers purchase the hardware because sales of the hardware will affect the variety of the complementary software that will be available. Liebowitz and Margolis (1994, p. 139) argue that such effects are not consumption externalities, but rather they "describe nothing more than welfare-neutral interactions that occur in properly functioning markets." Networks in Telecommunications D(p,a+g)+A D0(p,a+g) Figure 3.21. Additional access demand for network services when there are complementary services. provider who is using the network. The cost may be an explicit access charge that is passed on to consumers by the service provider. Alternatively, the access cost can represent the degree of compatibility of the network with the complementary service. Consumers experience this type of access cost as a loss of service quality or as a cost of buying an adaptor. A network with more open access will have a lower value of the access cost a than would a network with less open access. The consumer's demand for network transmission services and complementary services maximizes net benefits, maxQ,MU(Q,M)-pQ-(a+g) Thus, the demand for network services, Q D(p, is a decreasing function of the price of network services p, the cost of access to complementary services a, and the price of complementary services g. The demand for network services is represented in Figure 3.20. Suppose now that the regulatory authority grants access to the network in the form of additional demand for network services, A. Without any other adjustments, there will be excess demand for network services. The effect of additional access demand for network services is shown in Figure 3.21. As already noted, one solution is to raise the price of access to existing customers and to users of access. Another solution is to raise the complementary services access costs a, which will reduce the availability of complementary services, thus shifting the demand function to the left. Of course, raising the price of network service