Oligopoly in the mobile market Ukraine

   
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on topic: Oligopoly in the mobile market Ukraine

Oligopoly - is a type of market structure, which is dominated by a few firms, each of which is able to influence the market price of our own actions.

Features oligipoly

 

Oligopoly is the most prevalent in modern high-tech industries in the computer industry and has the following features:

• The market has several sellers;
• In oligopoly may be produced as a homogeneous and differentiated products;
• Overarching interdependence of firms, which occurs due to the small number of firms in the market;
• Large entry barriers in the industry. Barriers to entry in an oligopolistic industry is quite high;
• There is a full awareness of market prices and volumes.

Oligopoly in the mobile market Ukraine

 

Ukraine has a large enough share of the market with an oligopolistic structure. Thus, at the beginning of 2007, with 286 national markets in 49 there was "hard" oligopoly, and 96 - were signs of dominance.On the Ukrainian mobile market operates quite "hard oligopoly" where 2-3 companies dominate the entire market, namely two "MTS" and "Kyivstar" dominated with over 90% share, and the other companies as: Life, TM «Beeline», «Golden Telecom GSM» and others - account for only 8% of the local.

Dynamics of mobile communication users

 

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Kyivstar

MTS

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Rates communication "Kyivstar" at the beginning were significantly lower than those of "MTS", but then "MTS" has used the strategy of "call price" reduce tariffs more advantageous than on the "Kyivstar", as a result, to increase demand for their services used strategy of "providing high-quality service image", namely arguing the quality networks in every region of Ukraine, especially in the highlands.

Conclusions

 

The report of the two largest mobile operators, "Kyivstar" and "MTS" on the job in 2012: both companies increased by 11% and revenue increased profitability of services. Revenue growth povyazuyetsya so that subscribers of operators has increased.

So in Ukraine there is rapid development of the mobile market. The main part of market occupied by two operators "MTS" and "Kyivstar" and their position is oligopolistic. Analyzing the activity "MTS" and "Kyivstar", we can conclude that they operate on oligopolistic pricing model "broken" demand curve, which explains price stability or simultaneous shift. In general, the study of the problem of strategic interaction between firms is central to the behavior of                     oligopolists.