Title: | Market Penetration and Late Entry in Mobile Telephony |
Authors: | Hoernig, Steffen - Universidade Nova de Lisboa |
Keywords: | Mobile Telephony, Entry, Penetration, Mobile termination rates |
Issue Date: | 2008 |
Series/Report no.: | Net Institute Working Paper;08-38 |
Abstract: | We consider some two dynamic models of entry in mobile telephony, with and without strategic pricing, and taking into account market penetration at entry, locked-in consumers and tariff-mediated network externalities. We show that on/off-net differentials may reduce the possibility of entry if incumbents are large, while they have no long-run effects if there are no locked-in consumers, or reduce the difference in subscriber numbers in their presence. Asymmetric fixedto- mobile or mobile-to-mobile termination rates increase (decrease) market share and profit of the network with the higher (lower) rate. While the fixed-to-mobile waterbed effect is not full at the network level, it will be full in the aggregate. |
URI: | http://hdl.handle.net/2451/29490 |
Appears in Collections: | NET Institute Working Papers Series |
Files in This Item:
File | Description | Size | Format | |
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Hoernig_08-38.pdf | 358.18 kB | Adobe PDF | View/Open |
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