Analysis of demand and cost trends of telecommunications market operators in Russia

Abstract

The analysis of the functions of demand and costs of mobile operators leading in the telecommunications market is carried out. Methods used in the study: mathematical modeling, regression analysis, optimization. The Russian telecommunications market is an oligopoly, which makes it possible to analyze the dynamics of the development of the three dominant firms (MTS, Megafon and VimpelCom), since they are the ones that influence the market to a greater extent. Various models of demand and costs are considered in accordance with the dynamics of the development of the telecommunications market. Analysis of a number of weighted average voice communication prices depending on the total volume of voice traffic of services showed the presence of linear and power-law models of the inverse demand function in 2002-2021. The functions of the costs of mobile operators are considered and the direct dependence of costs on the volume of voice traffic is revealed. Cost functions and demand functions have a linear and power-law character in different periods of operator development, which indicates different types of scale expansion effects. The regularity of the influence of price dynamics on market growth is established: a power-law downward trend in prices stimulated intensive market growth, a linear downward trend contributed to smooth growth, and an increasing trend corresponding to the Giffen effect caused stagnation; it is proved that the concentration of the telecommunications market mainly determines the change in the market price of communication services; the principles of the impact of the scale-up effect on the change in the company's market share are defined: the constant return on scale-up can lead to both an increase and a narrowing of the operator's market share, depending on whether the company increases the pace of investment or reduces; the positive effect of scale-up, as a rule, causes an increase in the operator's market share, and the negative effect leads to a reduction in market share/ The conducted research can be used for further analysis of the actual data and trends of demand functions and costs functions of telecommunications market companies.