Review on Economic Analysis for Telecommunication Tariff Plans and Rational Policymaking of TFP

Abstract

With growing competition and decreasing traffic, many fixed operators offer more new tariff plans based on flat-rate to increase their revenue. But, previous studies were mainly focused on what was optimal tariff plan in telecommunication industry and studies on economic analysis of flat-rate plan are very few. This paper compares and analyzes tariff plans by applying desirable characteristics which telecommunication tariff must keep. Especially, it shows strength and weakness of new optional calling plan, Tailored Flat Pricing (TFP) in the Korea and rational policymaking of it. As the result of this paper, it is expected that there are many implications on desirable pricing policy in telephony market.