Mobile phones are a prevalent communication tool in Australia, with consumers spending more than $16 million on mobile service provision in 2008-09. The ability of consumers to choose their optimal service plan is therefore of considerable financial importance. There is growing anecdotal evidence indicating that consumers have difficulty discriminating between the plans offered by providers, and some suggestion that this phenomenon is being exacerbated and exploited by service providers.
The objective of this project is to survey the literature surrounding mobile telecommunications pricing and consumer behaviour, in order to identify models that accurately describe interactions between firms and consumers in the Australian mobile telecommunications market, and to assess whether the concerns regarding consumer choice are warranted. The project will focus on factors that influence consumers ' ability to make optimal decisions and affect the level of competition between providers.
The project will consider pricing theory, with particular reference to price discrimination and pricing in network industries. It will also examine both neoclassical and behavioural consumer theory and will survey evidence from empirical studies. The conclusions drawn from this review will contribute to the understanding of consumer choice in the mobile telecommunications market, and identify opportunities for further research.