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The role of mobile handsets in advanced network service evolution: Evidence from Japan

Listed author(s):
  • Ono, Shigeru
  • Tang, Puay
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    This paper aims at a better understanding of the mechanisms of mobile network service evolution through a closer examination of the context of mobile handsets. It aims first to establish quantitatively that mobile handsets are a determinant of mobile network service evolution patterns, and second, to develop a consistent perspective capable of explaining the evolution of various mobile network services. Despite the fact that mobile handsets are indispensable to users of mobile network services, surprisingly little is known about the role of these handsets in mobile network service evolution. This paper provides quantitative evidence of a positive relationship between intra-network-carrier penetration rates for mobile network service subscribers and mobile handsets designed for these services. The relationship is such that if one network service is diffused more than another, the mobile handsets related to the more diffused service are similarly more widely diffused in the market, and vice versa. The evidence is derived from an analysis of two mobile network services in Japan, mobile Internet and third generation mobile, initiated by NTT DoCoMo and KDDI. There are no existing studies that consistently explain the mechanisms of different mobile network service evolution patterns. Since the positive relationship that emerges from the analysis is consistent for both cases, by examining the mechanisms underlying this relationship, the paper develops an adequate and consistent perspective based on a constituent model reflecting the technological and competition structure of mobile network services. From this perspective, this positive relationship can be explained as the similarity or dissimilarity in essential technology ownership distribution across constituents. This perspective describes mobile network evolution in terms of changes in the distribution of essential technology ownership and, therefore, could be generalised more widely.

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    Article provided by Elsevier in its journal Telecommunications Policy.

    Volume (Year): 34 (2010)
    Issue (Month): 8 (September)
    Pages: 444-460

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    Handle: RePEc:eee:telpol:v:34:y:2010:i:8:p:444-460
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