Estimating the extent of potential competition in the Korean mobile telecommunications market: Switching costs and number portability

• Published in: International journal of industrial organization Vol. 24; no. 1; pp. 107 - 124
• Main Authors: Lee, Jongsu, Kim, Yeonbae, Lee, Jeong-Dong, Park, Yuri
• Format: Journal Article
• Language: English
• Published: Amsterdam Elsevier B.V 2006; Elsevier; Elsevier Sequoia S.A
• Series: International Journal of Industrial Organization
• Subjects: Business economics; Competition; Conjoint analysis; Cost function; Data analysis; Economic theory; Empirical tests; Market analysis; Market structure; Mobile communications networks; Number portability; South Korea; Studies; Switching costs; Telecommunications; Telephone; Telephone number portability; Korea; L96; Switching costs; Conjoint analysis; L1; Number portability
• ISSN: 0167-7187; 1873-7986
• DOI: 10.1016/j.ijindorg.2005.07.003

Number portability service in the mobile communications market is believed to play an important role in lowering the switching costs which can increase the level of competition among providers. The aim of this study was to estimate the switching costs and consumers' valuation of the number portability service in the Korean mobile communications market using conjoint analysis and the stated preference approach. The analysis showed that the switching costs have been lowered considerably since number portability has been in force. However, a significant level of switching costs still remains despite number portability. Finally, this paper provides some implications for the competition strategy in the mobile communications market.