User Subscription, Revenue Maximization, and Competition in Communications Markets

In order to understand the complex interactions between different technologies in a communications market, it is of fundamental importance to understand how technologies affect the demand of users and competition between Network Service Providers (NSPs). To this end, the authors analyze user subscription dynamics and revenue maximization in monopolisitc and duopolistic communications markets. First, by considering a monopoly market with only one NSP, they investigate the impact of technologies on the users' dynamic subscription. It is shown that, for any price charged by the NSP, there exists a unique equilibrium point of the considered user subscription dynamics. They also provide a sufficient condition under which the user subscription dynamics converges to the equilibrium point starting from any initial point.