Pricing strategies in the mobile telecommunications industry

Mobile telephone is an example extremely successful of telecommunications service that has got a very high penetration rate. Nowadays, the competition in the mobile telephone sector is based on the possibility to build market share, by keeping the rival's subscribers. In order to pursue this goal, for some years, the mobile networks have chosen a price discrimination between on net and off net calls. The main aim of this paper is the analysis of the impact of this strategy in relation to an important parameter, such as the brand loyalty. Moreover, this paper analyses the hypothesis of non-reciprocal access pricing. In fact, the actual interconnection negotiations are based on the reciprocity of the access charge. This paper relaxes this assumption in order to show the effects on profits and on market shares deriving from the possibility for the incumbent or follower network to set an higher access charge