A LOOK AT THE CELL PHONE MARKET AND WHAT IT ENTAILS
ECO 252
April 24, 2008
Recent changes in the competition of cell phones and cell phone companies have lead to an unheralded battle for customers. In addition to the style of the cell phone, and the functions available on the cell phone, there are now mobility commands, which make the competition even stronger. These mobility commands include the fact that consumers can now keep their phone numbers even if they change cell carriers, and they can convert their landline number to cell phone numbers. Due to this change it is expected that cell phone users, nearly 30 million, will change cell phone service providers in the first year after these commands are put into effect. As new customers investigate changing cell phone service, they will also be checking out the various types and functions of different cell phones, which will lead to more sales, production, and jobs.
Every company wants more business. It is anticipated that there will be great deals, more minutes, lower monthly fees, cooler phones and maybe even better service, as the cell phone service providers try to keep their current customers and compete for as many others from other providers as they can. Since fear of losing their number is the main reason consumers stay with cell phone companies that they are not totally satisfied with, number mobility is a big deal for cell phone carriers wanting to hang onto their customers and exploit more of their competitors.
Every major company started campaigns even before the ruling took effect. Some of the companies started handing out free phones, providing additional minutes, giving cash credits and other types of incentives to keep existing customers. As examples, AT&T Wireless was giving away $50 credits to some customers who were willing to sign up for an additional...