http://dmarron.com/2009/11/15/the-weird-economics-of-cellular-calling-plans/ Musings on Economics, Finance, and Life Thu, 24 May 2012 19:06:33 +0000 hourly 1 http://wordpress.com/ http://dmarron.com/2009/11/15/the-weird-economics-of-cellular-calling-plans/#comment-8830 Mon, 07 May 2012 22:48:43 +0000 http://dmarron.com/?p=2118#comment-8830 [...] But all too often, a zero price attracts bad customers and encourages excessive consumption. Marco Arment of Instapaper, for example, discovered that a zero price attracted “undesirable customers” for his app. And AT&T famously discovered that offering unlimited iPhone data could overwhelm its capacity. [...]

]]> http://dmarron.com/2009/11/15/the-weird-economics-of-cellular-calling-plans/#comment-1428 Sat, 21 Nov 2009 21:11:14 +0000 http://dmarron.com/?p=2118#comment-1428 It is even worse in the corporate environment (a personal area of expertise) where some contracts allow companies to bundle minutes for all users. This has sometimes resulted in the optimal strategy being to leave unused phones in service after an employee is terminated. It is cheaper to pay the monthly fee on the unused phone and continue to aggregate the minutes than pay overage charges.

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