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Complexity, intransparency, oligopoly and market failure
1. The identification of the most efficient tariffs
Due to the considerable complexity of the usage structures and their cost effects in connection with the high number of possible tariff variants, it is practically impossible to determine the most efficient tariffs using conventional means.
For each user, the individual and complex telephony behaviour (call duration and data volume per target network, country, etc.) would first have to be recorded. In the case of large companies, this information alone could comprise millions of parameters for a required representative period. In addition, the costs for up to several hundred combinations of tariffs and tariff options with partly non-transparent features would have to be calculated for each provider for the telephony behaviour of each user.
Possible flat-rate pricing models can reduce the complexity to some extent, but are commercially disadvantageous due to the correspondingly higher flat-rate prices.
2. Achieving the lowest possible prices
In the telecommunications market there is a pronounced provider oligopoly for business customers. Often, due to technological requirements, only one competitor can be considered as an alternative to the existing provider. The severely limited competition makes effective market pricing difficult to the detriment of purchasing.
Since the cost structures of the providers are also very similar and the marginal costs of the services are close to zero euros, the existing provider could "go along" with every offer of the competitor. Consequently, the competitor has hardly any chance of winning the customer, so that in many cases the competitor makes no offer at all, or at least no offer that is attractive in price. Purchasing then often only has the option of accepting the non-competitive offer of the existing provider to extend the contract.See Solution