Optimal Pricing for Wireless Services : A Dynamic Analysis in a Spatial Framework

The issue of wireless service pricing is an important concern in wireless networks. Underpricing as well as overpricing of such services, that occur ubiquitously, can adversely affect the growth of the sector and often leave a dent on the benefits of consumers. Different prices for wireless services prevail under supply and demand constraints. However, the notion of the "optimal price", which will maximize the total social benefits from the perspective of the consumer and the service provider or the firm, can result in the wellbeing of both the associated stakeholders. This is the entry point of this analysis. Setting such an "optimal rule of pricing" would in turn act as a tool for regulators and investors to exercise the best practices in terms of resource utilization. This paper is an attempt to establish a theoretical framework for obtaining such an "optimal pricing rule" under the assumptions of the existence of multiple service providers, consumers over multiple geographical locations and for a given time period. It has been shown that such a price also ensures Pareto-Optimality