Question 8.24

14. Explain the following situations.

  1. In Europe, many cell phone service providers give away for free what would otherwise be very expensive cell phones when a service contract is purchased. Why might a company want to do that?

  2. In the United Kingdom, the country’s antitrust authority prohibited the cell phone service provider Vodaphone from offering a plan that gave customers free calls to other Vodaphone customers. Why might Vodaphone have wanted to offer these calls for free? Why might a government want to step in and ban this practice? Why might it not be a good idea for a government to interfere in this way?