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Mobile Termination: What is the “Right” Charge?

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  • Tommaso Valletti

    ()

  • George Houpis

    ()

Abstract

The regulation of fixed-to-mobile (F2M) termination charges has become increasingly important in Europe, Australia, and New Zealand under the Calling Party Pays principle. In the absence of any regulation, mobile operators have an incentive to set F2M termination charges “too high”. We show that the setting of the optimal F2M termination charges depends on the significance of network externalities, the intensity of competition in the mobile sector, and the distribution of customer preferences. We also discuss the merits of possible remedies which are not very intrusive. Copyright Springer Science+Business Media, Inc. 2005

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File URL: http://hdl.handle.net/10.1007/s11149-005-3955-1
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Bibliographic Info

Article provided by Springer in its journal Journal of Regulatory Economics.

Volume (Year): 28 (2005)
Issue (Month): 3 (November)
Pages: 235-258

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Handle: RePEc:kap:regeco:v:28:y:2005:i:3:p:235-258

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Web page: http://www.springerlink.com/link.asp?id=100298

Related research

Keywords: mobile telephony; network externality; termination charges; L41; L96;

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  1. Littlechild, S.C., 0. "Mobile termination charges: Calling Party Pays versus Receiving Party Pays," Telecommunications Policy, Elsevier, vol. 30(5-6), pages 242-277, June.
  2. Armstrong, Mark, 1997. "Mobile telephony in the UK," MPRA Paper 35405, University Library of Munich, Germany.
  3. Armstrong, Mark, 2001. "The theory of access pricing and interconnection," MPRA Paper 15608, University Library of Munich, Germany.
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