Efficiency of price competition in the telecommunications market

Abstract

Over the past few years, the Russian telecommunications market has shown one of the highest growth rates in the country. According to RBC media holding, which, in turn, refers to the independent consulting Agency TMT Consulting, in 2018, the market volume increased by 3.4%, 0.6 percentage points more than in 2017. The main driver of growth was the mobile business, whose revenue grew by 5%. Among the most likely reasons for such results, it is possible to identify the cancellation of most tariffs that provided unlimited Internet access to subscribers, and the termination of price competition. The rejection of tariff plans with unlimited Internet access allows the operator to increase the ARPU, which also reached a record high in 2018. The purpose of the article is to refute or prove the possibility of using price dumping mechanisms in the oligopolistic telecommunications market in Russia.