Multiperiod subscription pricing for cellular wireless entrants

Abstract

We consider a two-player game involving a large incumbent (or incumbent oligopoly) and small entrant into a cellular-wireless access provider marketplace. The entrant's customers must pay roaming charges. We assume that the roaming charges are transparent to the user and regulated to prevent an incumbent from creating barriers to entry in the marketplace. To be able to reckon suitable (regulated) roaming charges, in this paper we consider a potentially stricter model of competition than [7] (though still not all subscribers to the lowest-cost provider), and a revenue function for the entrant that considers future revenue streams when its deployment is greater and its customers therefore do not roam as much, i.e., a multiperiod/longitudinal revenue model.