Technology Interactions in the Presence of Network Effects: Fixed Telephony, Mobile Telephony and the Internet (original) (raw)
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Proceedings - Academy of Management, 2007
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This study examines the growth of global mobile telephony and the economic factors that affect this growth. Mobile telephony has exhibited substantial growth in the decade to 2000 and this growth is expected to continue with the introduction of technically advanced mobile cellular networks. A dynamic demand model is estimated by using global telecommunications panel data comprised of 56 countries.
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Mobile telephony penetration is a major indicator of mobile telephony diffusion. Taiwan had a mobile telephony penetration of 108% in 2002, ranking first in the world. This study analyzes this accelerated diffusion in terms of growth model and determinants of the diffusion rate. To eliminate the inherent uncertainty associated with choosing the optimal growth model, this study compares the performance of three conventional models, namely Gompertz, Logistic and Bass, to identify the most appropriate model, and to distinguish the forces driving the diffusion rate. Empirical results indicate that the most appropriate model is the Logistic model. Network externalities, which this study shows to be the same as the imitation effect in the Bass model, explain the superiority of the Logistic model. Moreover, market competition, which markedly reduces service prices, is identified as a primary driver of the diffusion rate of mobile telephony in Taiwan. Economic conditions, technological innovation and number of operators are insignificant factors. Finally, mobile telephony is a substitute for fixed-line telephony in Taiwan.
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IEEE Transactions on Engineering Management, 2012
Analyzing mobile telephony diffusion involves identifying drivers and forecasting growth using a growth model. However, to our knowledge, no framework for model selection exists. To eliminate ad hoc model selection, this study presents a novel model-comparison method based on an analysis of mobile telephony diffusion in China, which accounts for one-fifth of global mobile telephony subscriptions. Determinants of the diffusion rate are then analyzed using the most appropriate model identified by the proposed model-comparison method in terms of minimum root-mean-square error. Empirical results identify the Gompertz model as the best model for diffusion forecasting. The three most significant determinants are low-costmobile handsets, prepaid services, and personal handy-phone system (PHS) services.All of these determinants contribute to meeting the demand in China’s lowend market. This study combines the proposed model-comparison method with estimates of determinants of diffusion rate to improve analysis and forecasting accuracy for mobile telephony diffusion. Moreover, model comparisons using data from eight representative countries (Brazil, China, France, Germany, India, Russia, the U.K., and the U.S.) provide a valuable reference formodel selection for mobile telephony diffusion.
Diffusion models of mobile telephony in Greece
Telecommunications Policy, 2008
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