Vnu journal of Science: Policy and Management Studies, Vol. 3, No. (2017) 21-29
tải về 274.4 Kb. Chế độ xem pdf
|
Unit 1
| 5. Results and discussion
Table 1 shows the concentration index HHI of Vietnam. There is a declining trend of the level of concentration of the Vietnam’s mobile telecommunications market in period of 2006- 2015, which suggests that the market is more and more competitive. In 2016, however, with the continued strong development of Viettel, the HHI index rebounds. The HHI of Vietnam compared with some countries in the world is summarized in Figure 3. Naldi and Flamini [11] provides some HHI benchmarks to state about the level of market concentration. If HHI is in the range of 1,500- 2,500 the market is considered moderate competitive. If HHI is over 2,500 the market is called highly concentrated. The US Department of Justice used the mark calculated of 1,800 in adjudicating competition disputes in the long- distance call telecommunications market [4]. As shown in figure 3, the HHI of the Vietnam’s mobile market is still high compared to the benchmark of 2,500 and to the indices of many countries’ mobile services markets. Moreover, the HHI tends to increase from 2016 forward. As such, Vietnam’s mobile market is one of the highly concentrated ones which can reflect unfair competition among network operators, especially low opportunities for firms who would want to enter the market. This may be a sign that regulators need to consider. Table 2 provide estimated model of demand curve of Vietnam mobile services. As pointed out in section 2, the elasticity of the demand for mobile telecommunications market estimated in the majority of studies ranges from 0.2 to 0.9. Some special cases, for example, Malaysia's mobile access market are highly elastic, from - 4.08 to -6.41 depending on the operator [23]. With 4784 . 1 , the elasticity of demand determined in the mobile market in Vietnam is relatively high, i.e. the demand curve is elastic to price change; a small increase in mobile charges causes significant decrease in the service demand. This suggests that it would be difficult for a single firm to increase price while retaining its demand to earn high profit. Table 1. HHI of Vietnam mobile services market Year 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 HHI 5649 4949 4545 4141 4704 4012 3775 4341 - 3161 3484 (Source: Data from [21, 22], and authors’ calculation) D.T.V. Duc, N.P. Hung / VNU Journal of Science: Policy and Management Studies, Vol. 33, No. 2 (2017) 21-29 27 Figure 3. Herfindahl-Hirschman Index of Vietnam’s and some other countries’ mobile services markets. (Source: Data from [8] and authors’ calculation) Table 2. Estimated model of price elasticity of demand for Vietnam mobile servicesr (Source: Data from [21, 22] and authors’ model estimation) The results of the computation, comparison of the HHI and the price elasticity of demand show different implications of competition in the Vietnam mobile market. The HHI indicates that the concentration of the Vietnam mobile market is high compared with those of other countries. This suggests high extent of domination of sales by one or more firms in the mobile services market, in the case of Vietnam, Viettel’s market share is about 50%, which may harm the competition. The higher the HHI, the higher the profitability of the dominant market players is. According to consultancy firm McKinsey & Company’s study on the relationship between market share and margins achieved in Middle East and Africa, if HHI is in the range of 3,000-3,500, the market leader can have Earnings before interest, taxes and depreciation (EBITDA) reaching 47%; the second and third companies are able to achieve a profit margin of 35% and 25%, respectively [22]. Profit margins are generated by two sources: the size of sales and the effectiveness of the business. Thus, basically market-leading firms are having advantages and the opportunities for small firms, or new entrants to enter the market will be small. In the case of Vietnam, in addition to the high HHI, there is another characteristic that the HHI is likely to rebound after a period of continuous Highly concentrated market Moderate concentrat ed market Coefficients: Estimate Std. Error t value Pr(>|t|) (Intercept) 7.6463 5.7069 1.340 0.217107 log(P) -1.4784 0.5454 -2.711 0.026636 * log(I) 1.3957 0.2088 6.684 0.000155 *** --- Signif. codes: 0 ‘***’ 0.001 ‘**’ 0.01 ‘*’ 0.05 ‘.’ 0.1 ‘ ’ 1 Residual standard error: 0.2129 on 8 degrees of freedom (1 observation deleted due to missingness) Multiple R-squared: 0.9593, Adjusted R-squared: 0.9492 F-statistic: 94.38 on 2 and 8 DF, p-value: 2.733e-06 D.T.V. Duc, N.P. Hung / VNU Journal of Science: Policy and Management Studies, Vol. 33, No. 2 (2017) 21-29 28 decline. This is something that regulators need to pay attention. The estimation shows that the demand of Vietnam mobile telecommunications market has relatively more elastic demand than many other countries. For every one price unit drop, services volume increases by 1.47 units. This may be related to the characteristics of the low-income market when price are considered as the most important factor for the selection and consumption of services. Thus, price-based competition is important in Vietnam. This result also suggests that it is difficult for a firm to increase its price in the market without harming its demand of service. In contrast, price reduction can be a strategy of large firm to exclude the competitors as long as its profit margin remains positive. Therefore, price regulation in the direction of anti-predatory pricing is appropriate in Vietnam. Due to the lack of business data, the article does not estimate the separate demand model for each mobile operator, including Viettel, Mobifone or Vinaphone, so it is not yet clear whether each of these large firms can definitely impact the market price, from that to determine their market power. tải về 274.4 Kb. Chia sẻ với bạn bè của bạn:
|