Modern service industry is synchronous consumption and production，the consumers always buy the service from a company based on its reputation，as a result，reputation mechanism plays an important role in the pricing and competition of the products of modern service industry. This paper uses Bass Spreading Model to describe reputation mechanism between modern service enterprises，sets up price competition model and discusses the optimal price strategy of competitive modern service industry. The research results show that there is balanced price strategy in the competition of service industries，that there is no necessity to use adverse price competition strategy between the companies doing the same business，that service industries can raise the price only under the premise of improving service quality and increasing company reputation，and that it is necessary to share and interact with factors and resources between the companies doing the same business in order to promote their main business and obtain competitive advantage.