Prospects for Improving Competition in Mobile Roaming

Title: Prospects for Improving Competition in Mobile Roaming

Research Question: What are the prospects for improving competition in mobile roaming, and what factors contribute to these prospects?

Methodology: The study used a combination of quantitative and qualitative methods to analyze the prospects for improving competition in mobile roaming. The quantitative analysis involved data collection and analysis from various sources, such as international roaming prices, market share data, and customer satisfaction surveys. The qualitative analysis involved interviews with industry experts, mobile operators, and regulatory authorities to gain insights into the factors affecting competition in mobile roaming.

Results: The study found several factors contributing to the prospects for improving competition in mobile roaming. These factors include:

1. High combined market share of the two leading operators combined with second mover disadvantages: The study found that the high market share of the two leading operators in each country creates a barrier to entry for new players, leading to reduced competition. Additionally, the second mover disadvantages, where later entrants face difficulties in attracting customers, further contribute to reduced competition.

2. Demand externalities associated with customer ignorance and lack of control over network selection: The study found that customers often lack the necessary information to make informed choices about mobile roaming, and this leads to reduced competition. Additionally, the lack of control over network selection further contributes to reduced competition.

Prospects for improving competition in mobile roaming: The study found several developments that are likely to modify the situation in the future. These developments include:

1. SIM over-the-air programming: This technology allows mobile operators to direct customers to networks with the lowest charges.

2. Dual mode handsets: As dual mode handsets become ubiquitous, customers will have the ability to switch between networks, leading to increased competition.

3. New entrant GSM 1800 operators: New entrant GSM 1800 operators reaching nationwide coverage will increase competition by offering lower charges in exchange for preferred roaming status.

4. Larger GSM 900 operators: These operators, particularly those with a pan-European footprint, will have the bargaining power to ask for lower charges in exchange for preferred roaming status.

Implications: The study suggests that anti-discrimination rules contained in licenses, competition law, or the GSM international roaming framework should not be applied in a way that impairs the competitive downward adjustment of wholesale roaming charges. This will allow for increased competition and lower prices for consumers.

In conclusion, the study found that there are several factors contributing to reduced competition in mobile roaming, but there are also several developments that are likely to improve competition in the future. By addressing these factors and taking advantage of these developments, the prospects for improving competition in mobile roaming can be significantly improved.

Link to Article: https://arxiv.org/abs/0109115v2 Authors: arXiv ID: 0109115v2