Game Theory Analysis of Competitive Pricing Among Mobile Network Operators in Abuja

The Nigerian telecommunications market exhibits intense oligopolistic competition, with major mobile network operators engaging in dynamic pricing strategies to attract and retain subscribers. This study applies non-cooperative game theory, specifically the Nash equilibrium framework, to analyse competitive pricing behaviour among three dominant operators in the Federal Capital Territory, Abuja. Using published tariff data and subscriber base statistics from the Nigerian Communications Commission over a 24-month period, payoff matrices are constructed for pricing decisions across voice, data, and value-added service categories. Dominant strategy equilibria are identified where they exist, and Nash equilibria are computed for games where no dominant strategy applies. The prisoner's dilemma structure is identified in data pricing competition, indicating that rational self-interest drives operators toward price wars that reduce industry-wide profitability below what coordinated pricing would yield. Extensive form game analysis captures sequential pricing moves triggered by promotional campaigns. Findings suggest that operators consistently undercut competitors' data bundle prices, resulting in a Nash equilibrium with prices approximately 22 percent below cooperative levels. The study also examines the role of regulatory intervention in shifting equilibrium outcomes toward consumer-beneficial pricing. Recommendations include regulatory frameworks that prevent predatory pricing while preserving competitive incentives. This research contributes game theoretic insights into competitive market dynamics within Nigeria's telecommunications sector. Keywords: game theory, Nash equilibrium, competitive pricing, telecommunications, Abuja