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Pricing strategies and competition in the mobile broadband market

Author

Listed:
  • Joan Calzada

    (Universitat de Barcelona)

  • Fernando Martínez-Santos

    (Competition and Markets Authority and Universitat de Barcelona)

Abstract

This paper analyzes mobile broadband plan prices in 37 countries between 2011 and 2014. Mobile network operators typically commercialize usage-based plans that include an access fee, a usage allowance (number of GB included in the tariff plan), and a penalty system should consumers exceed the contracted allowance. Our empirical model shows that the prices of these plans are lower than those of unlimited contracts, and that they depend on the type of penalty that is used. The prices also reflect service characteristics, including the technology provided, the download speed, and telephone call allowances. Plans that bundle mobile broadband plans with smartphone devices have longer contract duration and may be more expensive than plans that only include a SIM card. Specifically, broadband service plans are priced higher when they include an iPhone or a Samsung smartphone. The paper also discusses the impact of market structure and entry regulation on prices.

Suggested Citation

  • Joan Calzada & Fernando Martínez-Santos, 2016. "Pricing strategies and competition in the mobile broadband market," Journal of Regulatory Economics, Springer, vol. 50(1), pages 70-98, August.
    • Handle: RePEc:kap:regeco:v:50:y:2016:i:1:d:10.1007_s11149-016-9307-5
    DOI: 10.1007/s11149-016-9307-5
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Telecommunications; Mobile broadband; Price discrimination; Smartphones; Competition; Regulation;
    All these keywords.

    JEL classification:

    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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