The classic economic problem with utilities (power, water, phone,gas) is they occupy what is called a natural monopoly[0]. My econ 101 prof explained it thusly: It would be really wasteful if there were 100 different power lines going to your house, yet you'd need at least that many power companies to have something approaching a free market where supply=demand. Not just is the 100 power line outcome wasteful, it won't emerge in a free market.
You can't remove the reasons this happens, you can however regulate it to either somehow cause a competitive market or prevent the monopolist from leveraging their position and price gouging.
Now, obviously cell phone carriers are not a monopoly. They are actually an oligopoly[1], but that doesn't change much and the barriers that lead to it are the same.
You can't remove the reasons this happens, you can however regulate it to either somehow cause a competitive market or prevent the monopolist from leveraging their position and price gouging.
Now, obviously cell phone carriers are not a monopoly. They are actually an oligopoly[1], but that doesn't change much and the barriers that lead to it are the same.
[0]http://en.wikipedia.org/wiki/Natural_monopoly [1] http://en.wikipedia.org/wiki/Oligopoly