Competition in Mobile Telephony in France and Germany

Posted by D. Daniel Sokol

Lukasz Grzybowski, University of Cape Town (UCT) and Chiraz Karamti, Telecom Bretagne analyze Competition in Mobile Telephony in France and Germany.

ABSTRACT: This paper analyses the development of mobile telephony in France and Germany in 1998–2002. We conduct this analysis in relation to the antitrust investigation initiated by the French competition authority in 2002 due to exchange of strategic information and a share-fixing agreement between network operators. The results suggest a significant difference between price elasticities of demand in these two countries. Moreover, consumers perceive mobile telephony as a substitute for fixed-line connection in France and as a complement in Germany. In the time period of the share-fixing agreement among French network operators there were no adverse shifts in the levels of prices and subscriptions.