Capitalism is a game in which the goal is simply to make the most money (with the least effort). The "free market" (aka competition) is just one of many possible strategies to make the most money.
I have to correct you here, because you are way, way off in your description of these concepts.
Capitalism is a "game" in the sense that every system is a game. "Evolution is a "game" in which the goal is to pass on your genes, and therefore (insert discussion of evolution using game terms)." etc. I strongly suspect (due to your following statements) that you're using "game" as a pejorative term to discredit the idea of capitalism because, although you don't really know what it means, you've been told that it's worse than (insert another economic system here) based on (insert oversimplified discussion of benefits of other economic system and pitfalls of capitalism).
Capitalism is a system of economics in which (hypothetically) the capital means of production are owned by individuals, rather than the state, and through the mechanism of offer/counteroffer, prices are "discovered" due to market action. The "free market" is a related, but distinct concept based on the idea that the most efficient economies are reached through market action that is facilitated by a few conditions, including:
1) Low (or nonexistent) barriers to entry in a market
2) Widespread access to information
In such a free market, the price that a company would be able to charge (i.e. the price that buyers would be willing to pay) would always draw very close to the cost of offering their product or service, due to the ability of competitors to jump into the market and undercut a company charging exorbitant rates, the knowledge of the buyers that the rates being charged were excessive, etc.
However, the market created by the Telcos doesn't even remotely resemble a free market, due to:
1) EXTREMELY high barriers to entry (legal monopolies on "the last mile" within residential neighborhoods, HUGE infrastructure costs in laying the network infrastructure outside these neighborhoods, etc.)
2) The Telcos are often owned by the same vested interests that control the media, and therefore the information regarding the costs to provide these services is deliberately hidden/not broadcast/drowned out by misinformation/etc.
In other words, while your assertion that "practically every business on earth bends over backwards to avoid the free market at all costs" is essentially correct, your understanding of *why* this is the case is so wrong as to be dangerous.
The issue here is: the telecommunications market is not free and never has been. For a variety of reasons, a free Telco market is both impossible and impractical, and therefore the closest thing that we can do is have the infrastructure be handled as a government-owned utility, and have the providers of service compete against each other... but this is not remotely the same thing as "free markets are a bad strategy for business"...