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An Analysis of Demand-based Factors for Broadband Migration

Author

Listed:
  • Manit Satitsamitpong

    () (Doctoral Program, Graduate School of Global Information and Telecommunication Studies, Waseda University, Japan)

  • Tokio Otsuka

    () (Institute for Digital Society, Waseda University, Japan)

  • Toshiya Jitsuzumi

    () (Faculty of Economics, Kyushu University, Fukuoka, Japan)

  • Hitoshi Mitomo

    () (Graduate School of Asia-Pacific Studies, Waseda University, Japan)

Abstract

This paper explores the factors that influence the users’ decision to migrate from narrowband to broadband services. Data used were obtained from web questionnaire surveys in Japan and the annual Internet User Profile Survey of the National Electronics and Computer Technology Center (NECTEC) in Thailand. The economic, technological and demographic factors were analyzed by using a mixed logit model. The results suggest that price, as a proxy for economic factor, is an important factor in a developing country. In Thai case, lowering the price of broadband services to 50% would increase the probability of the users migrating to broadband by more than 5%. Demographic factors including income, location, and internet experience also contribute to the decision, but their impacts are smaller than that of price. Contrary to previous studies, speed is not a statistically significant factor.

Suggested Citation

  • Manit Satitsamitpong & Tokio Otsuka & Toshiya Jitsuzumi & Hitoshi Mitomo, 2012. "An Analysis of Demand-based Factors for Broadband Migration," Applied Economics Journal, Kasetsart University, Faculty of Economics, Center for Applied Economic Research, vol. 19(2), pages 1-17, December.
  • Handle: RePEc:aej:apecjn:v:19:y:2012:i:2:p:1-17
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    References listed on IDEAS

    as
    1. Hausman, Jerry & McFadden, Daniel, 1984. "Specification Tests for the Multinomial Logit Model," Econometrica, Econometric Society, vol. 52(5), pages 1219-1240, September.
    2. Gary Madden & Michael Simpson, 1997. "Residential broadband subscription demand: an econometric analysis of Australian choice experiment data," Applied Economics, Taylor & Francis Journals, vol. 29(8), pages 1073-1078.
    3. Savage Scott J. & Waldman Donald M., 2004. "United States Demand for Internet Access," Review of Network Economics, De Gruyter, vol. 3(3), pages 1-20, September.
    4. Takanori Ida & Toshifumi Kuroda, 2006. "Discrete Choice Analysis of Demand for Broadband in Japan," Journal of Regulatory Economics, Springer, vol. 29(1), pages 5-22, January.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    broadband; choice probability; mixed logit model; discrete choice model;

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • L63 - Industrial Organization - - Industry Studies: Manufacturing - - - Microelectronics; Computers; Communications Equipment

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