Location-Price Competition in Mobile Operator Market

In this paper, we propose a game-theoretic model of the mobile network market. The market is presented by three sides: primary mobile network operators (MNO), mobile virtual network operators (MVNO) and consumers of the services. MVNO are mobile operators without their own infrastructure. They buy resources from MNO and compete with other MVNO for the consumers selling a service in the mobile network market. We construct a two-stage game. In the first stage, MVNO (players) select the MNO, one or several, and then announce the price for their service for the consumers in this MNO. After the profile of prices is determined, the consumers are distributed among MVNOs following the logistic function. The equilibrium in this two-stage game is constructed. For identical consumers, the analytic formulas for the solution are derived.Funding Agencies|Academy of FinlandAcademy of Finland [296572, 316908, 311648]; Center for Industrial Information Technology (CENIIT) [17.01]; Russian Fund for Basic ResearchRussian Foundation for Basic Research (RFBR) [16-51-55006, 16-01-00183]; Shandong Province Double-Hundred Talent Plan [WST2017009]