Telecommunication Company in Malaysia is one of the examples for Oligopoly. Which mean a market form in which a market or industry is dominated by a small number of sellers. There are 3 big telecommunication companies that controlling Malaysia telecommunication industry which is Maxis, Digi, and Celcom.
When there are oligopoly companies in the market, they will be controlling and conquering the pricing of the product, example like telecommunication service. Hence, since they are the ones that will be setting up the price policy, they will have mutual interdependence towards each other because one’s action will affect others. For example, if Maxis suddenly came out with a very strong marketing strategy for the new upcoming mobile plans with much cheaper price than Celcom and DIGI, it is for sure that more customers will go to Maxis and subscribe with their plans. In order to avoid this kind of scenario, these three companies will have strategic behaviour among them.
However, most of the times they will choose to cooperate with each other. When they do cooperate with each other, they are actually making a very big monopoly whereby they will control the market and enjoy their respective supernormal profits in the long run. In some markets, they will share their market shares which often lead to inflation. This might seem a very good thing for the companies, but it’s a scary nightmare for the consumers.
In Conclusion, this is how the oligopoly companies work, and in Malaysia it is our telecommunication service provider companies. As a smart consumer, we need to know how these companies work thus we are more aware on how the economy works in Malaysia.
Prepare by Low Min Yon_0315409
No comments:
Post a Comment