Nova workboard

a blog from young economists at Nova SBE

Oligopoly of mobile operators

The competitiveness of the Czech economy – Czech companies, entrepreneurs as well as small consumers, have negative affect on expensive and poor quality of mobile services. Market of mobile services is not effectively competitive, because the CTO (Czech Telecommunication Office) does not fulfill its statutory function of protecting consumers and improvement of competition.

This has the effect of an oligopolistic behavior of Czech operators. Oligopolistic behavior of operators is manifested in their extra profits, most expensive mobile calls throughout the developed countries, the second lowest amount of investments in their networks in the EU and the worst 3G network in EU. Therefore government should take steps to reduce the cost of mobile services in the country [1].

Czech Telecommunication Office states that, according to market analysis, the Czech mobile operators are oligopolistic and competition is not sufficiently competitive. The Office does not talk about their mutual (in)formal contract, but acting in concert. Each other, more or less replicate the statement that any member does not protrude out of line, not have significantly discounting or improve conditions. The Office also recognizes that with this state they cannot do anything, but neither the EU. In this situation, we should get help from virtual operators [2].

Our three mobile operators are competing in the willingness and subservience to keep their customers. Their reason is that they want to keep customers as well as receive money. In the near future on the mobile market will come first virtual operator, which will significantly reduce the price of calls and SMS.

Virtual operator is actually the one that after agreement uses the existing network of existing mobile service provider. Important thing is that you do not have to be bound for two-year subscription of loyalty. In contrast to the “revolutionaries”, who offer a “huge” discount calls and unlimited calls and SMS. So, why all of a sudden they offer great tariffs? This is because, by the end of this year some virtual “players” will enter the market and they will push prices even lower [3].

In my opinion, especially government should be more interested in prices that mobile operators set, because it is impossible to pay for the same, sometimes even worse service, many times more than abroad. Therefore customers should be careful which tariffs they will choose and what prices they are willing to pay.

 

Kateřina Čadinová

 

References:

[1]http://www.informacniinstitut.cz/informacniinstitut/Informacni_Institut/Studie/Entries/2012/3/1_Studie_o_selhani_CTU__Oligopol_mobilnich_mobilnich_operatoru.html

[2] http://www.cnews.cz/ctu-uz-mluvi-o-oligopolu-mobilnich-operatoru-hleda-cesty-jak-prinest-virtualy

[3] http://ivoprecek.blog.idnes.cz/c/332577/Revoluce-mobilnich-operatoru-Ale-kdeze.html

http://www.apms.cz/fs/0b33ba60-5a4e-1030-bce3-000c29731ff1-120308-studie-inf-in-reakce-apms-5.pdf

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Author: studentnovasbe

Master student in Nova Sbe

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