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First-mover and incumbency advantages in mobile telecommunications

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  • Jakopin, Nejc M.
  • Klein, Andreas

Abstract

The present study analyzes data of 191 mobile network operators from 49 countries in order to identify the extent of first-mover and incumbency advantages. A large number of new market entry opportunities and involvement of many previous state-owned monopolists have characterized the mobile telecommunication services industry over the last 20years. The results of this study show that both, first-movers and incumbents in the mobile telecommunication services industry are more successful regarding market share and operational financial results than later entrants. A pioneer position and incumbency are only loosely connected, with success originating both from first-mover and incumbency advantages. Moreover, the timing effect is stronger and more sustainable for market share compared to operating margin, indicating that followers successfully compensate part of their market share disadvantages with strategies like SIM-only tariffs, outsourcing and alternative distribution approaches. In addition, the typical rank-based measurement of timing position reveals somewhat stronger associations than a variable that is using the time elapsed between commercial launches of pioneers and followers.

Suggested Citation

  • Jakopin, Nejc M. & Klein, Andreas, 2012. "First-mover and incumbency advantages in mobile telecommunications," Journal of Business Research, Elsevier, vol. 65(3), pages 362-370.
  • Handle: RePEc:eee:jbrese:v:65:y:2012:i:3:p:362-370
    DOI: 10.1016/j.jbusres.2011.05.009
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    References listed on IDEAS

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    1. repec:wsi:ijimxx:v:21:y:2017:i:04:n:s1363919617500402 is not listed on IDEAS
    2. Appelbaum, Elie & Katz, Eliakim, 1996. "Corporate taxation, incumbency advantage and entry," European Economic Review, Elsevier, vol. 40(9), pages 1817-1828, December.
    3. Muck, Johannes & Heimeshoff, Ulrich, 2012. "First mover advantages in mobile telecommunications: Evidence from OECD countries," DICE Discussion Papers 71, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    4. repec:eee:tefoso:v:123:y:2017:i:c:p:57-67 is not listed on IDEAS
    5. Curwen, Peter & Whalley, Jason, 2013. "Mapping worldwide mobile networks: Some problems and indicative solutions," Telecommunications Policy, Elsevier, vol. 37(11), pages 1150-1165.
    6. Besharat, Ali & Langan, Ryan J. & Nguyen, Carlin A., 2016. "Fashionably late: Strategies for competing against a pioneer advantage," Journal of Business Research, Elsevier, vol. 69(2), pages 718-725.

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