Hedonic prices in the German market for mobile phones

This paper provides a hedonic price analysis of mobile telephones for the German market, based on data of 302 different handsets from 25 manufacturers over the period from May 1998 to November 2003. By measuring shadow prices for different product characteristics, the authors find that volume, for example, has a negative effect on the price of a mobile handset, while the number of ringtones and the talk time battery life relative to the handset's weight positively affect mobile phone prices. Perhaps somewhat surprisingly, radiation is statistically insignificant. Also handsets have become cheaper over time, and handsets with additional features, such as MMS, MP3 or Bluetooth, command a higher price. In addition, there are positive brand name effects for some brands. According to the estimations presented in this paper the brand name premiums may range from 57 to 172 euro.     

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

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.     

CDMA：爆发的临界点

春节刚过，信源通科技（深圳）有限公司洽谈业务的客户突然多了起来，这其中不乏出身山寨的手机集成商。这些客户的需求都很直接：仿照一款热销的GSM手机，“勒”一块相同的CDMA主板，因为之前已经与中国电信某公司“切磋”过了，中国电信也已认可了这款机型。     

Mobile-only consumers arise from heterogeneous valuation of fixed services

Mobile-only users are usually perceived as a consequence of fixed-mobile substitution. This study uses a unique dataset based on a survey in France, combined with interviewee's telecommunications billing data, to reveal heterogeneous consumer preferences for fixed services. With the same mixed logit model we estimate the willingness to pay (WTP) for fixed communications services and fixed-mobile relationship. Results show a very large heterogeneity of WTP for fixed services among consumers. In addition, we show that fixed and mobile data are complement for all consumers. Mobile-only consumers have a much lower but non-zero WTP, and higher price sensitivity compared to fixed-mobile consumers. Consequently, an increase in the fixed offer price would reduce the demand for fixed service. Heterogeneous preferences for fixed services constitute an alternative explanation for the existence of mobile-only users, despite the complementary nature of fixed and mobile broadband. Counter-factual simulations show that the share of mobile-only could also be driven by the way to subsidize mobile handset. For instance, making the handset subsidy only available to fixed-mobile quadruple play subscribers could reduce the share of mobile-only by half.     

The public incumbent's defeat in mobile competition: Implications for the sequencing of telecommunications reform

Within a mere 5 years of market competition, the mobile communications sector in Taiwan has exceeded a 100% penetration rate, currently ranking near the top of the world. In an even more stunning development, the public incumbent, Chunghwa Telecom, has handed the leadership status to a market entrant, Taiwan Cellular Corp., despite phenomenal mobile communications growth. This paper explores the factors that hamstrung Chunghwa Telecom in competition against its rival entrants. Our econometric analysis substantiates the fact that handset subsidies are the most effective instrument for mobile firms to gain market share. Chunghwa Telecom, due to its public ownership status, was nevertheless prohibited at first from adopting such a marketing strategy.The empirical results provided in this paper indeed pinpoint the importance of the sequencing of reform mandates in developing telecommunications: a prolonged privatization could help to promote competition in the industry. Public ownership makes Chunghwa Telecom vulnerable to political intervention and operational inefficiency, which is a barricade to performance and competitiveness for the not-yet-privatized company in a liberalized market. Taiwan's case presents an interesting deviation from conventional development theories, while it deserves scrutiny as it paves a shortcut to successful implementation of telecommunication reform in a timely fashion.     

Diffusion of mobile telephony: Analysis of determinants in Cameroon

This paper explores the diffusion of mobile telephone technology in Cameroon by identifying and analyzing the determinants of this diffusion. Studying the diffusion of mobile communications in African countries by integrating them into panels of developing countries is problematic. This approach is likely to mask the intrinsic differences as concerns the diffusion process. This survey shows, through the estimation of an S-shaped growth curve, that the Logistic model best describes the diffusion of mobile phone technology in Cameroon. Income, openness to competition and the use of SMS are key forces driving this diffusion. Forecasts indicate an increase of almost 70% in the demand by 2026 as far as mobile phone use in Cameroon is concerned. This implies not only an improvement in operators' and State's revenues, but also, the need to invest in infrastructures. Our recommendation therefore calls for a greater liberalization of the mobile phone market in Cameroon. In addition, given the complementary relationship between the core and the mobile networks, infrastructural investments are also needed in both sectors.     

How disruptive is 5G?

The hypothesis is put forward that, after three decades of stability, there is now the prospect of significant change in the vertical and horizontal structure of the mobile market place. On the supply side, significant factors are, first, the availability of a new and very powerful form of mobile connectivity in the shape of 5G, and second, software defined networking, which allows a single network to provide a variety of heterogeneous services or ‘slices’. On the demand side, the digital transformation of the whole economy (and not just the communications sector) creates the need for diverse communications functions operating in a universe with a much wider set of digitally transformed services.Mobile operators will find themselves contesting customer relationship with firms or other organisations providing these services in an integrated fashion, and thus risk replacing their direct link with end users with becoming the wholesale supplier of an expanded but ‘commoditised’ communications product. We may also observe fewer radio access networks; more competitive backhaul; and the (partial) vertical disintegration of mobile network operators. The regulatory changes implied may include heavier regulation of fewer RANs, and the need for market analyses to confront situations in which network operators sell more and more of their services to a variety of heterogeneous content and application providers – some of them exercising substantial levels of market power.     

On regulations for 5G: Micro licensing for locally operated networks

Future 5G networks aim at providing new high-quality wireless services to meet stringent and case-specific needs of various vertical sectors beyond traditional mobile broadband offerings. 5G is expected to disrupt the mobile communication business ecosystem and open the market to drastically new sharing based network operational models. 5G technical features of network slicing and small cell deployments in higher carrier frequencies will lower the investment barrier for new entrants to deploy local radio access networks and offer vertical specific services in specific areas and allow them lease the remaining required infrastructure on demand from mobile network operators (MNO) or infrastructure vendors. To realize the full vision of 5G to benefit the society and promote competition, innovation and emergence of new services when the 5G end-to-end network spans across different stakeholders administrative domains, the existing regulations governing the mobile communication business ecosystem are being refined. This paper provides a tutorial overview on how 5G innovations impact mobile communications and reviews the regulatory elements relevant to 5G development for locally deployed networks. This paper expands the recent micro licensing model for local spectrum authorization in future 5G systems and provides guidelines for the development of the key micro licensing elements. This local micro licensing model can open the mobile market by allowing different stakeholders to deploy local small cell networks with locally issued spectrum licenses ensuring pre-defined quality guarantees for the vertical sectors’ case specific needs.     

手机大变局

"一夜之间,全球最成功的公司突然都成为了我们的竞争对手,这的确让我们有点儿难以置信。"说这话的是全球手机市场份额超过1/3的诺基亚公司的CEO康培凯,这家称霸手机     

Value-focused thinking about strategic management of radio spectrum for mobile communications in Korea

Radio spectrum has become an increasingly vital part of the telecommunications infrastructure and economy of a country. As spectrum management grapples with increasingly complex decisions in the 1990s, clarifying the basic values of the spectrum management will become more important. This study uses multiattribute utility theory as a basis for obtaining value judgments regarding strategic management of radio spectrum for mobile communications and applies it to a specific case study of Korea. To structure and quantify the basic values of spectrum management, we elicited strategic objectives, then refined and structured them into a hierarchy. We developed attributes and derived a utility function to illustrate value trade-offs at the strategic level. The implications of the results for addressing a range of strategic issues are also discussed. We found that the work and results can provide valuable insights and decision opportunities for virtually all major decision making in spectrum management for mobile communications in Korea.     

Estimating Consumer Inertia in Repeated Choices of Smartphones*

For a sample of 9,799 subscribers to a single mobile operator, we observe switching between mobile handsets between July, 2011, and December, 2014. We estimate a discrete choice model in which we account for disutility from switching to different operating systems and brands. Our estimation results indicate the presence of significant inertia in the choice of operating systems and brands. We use our model to simulate market shares in the absence of switching costs and conclude that the market shares of Android and smaller operating systems would increase at the expense of the market share of iOS in such a context.     

Estimating willingness-to-pay for broadband attributes among low-income consumers: Results from two FCC lifeline pilot projects

Recent studies have confirmed that broadband adoption (as opposed to simply having access to broadband infrastructure) is positively linked with economic growth. In light of this, federal policy efforts have switched from focusing mainly on the provision of infrastructure to more explicit adoption-oriented efforts. One of those efforts was the Federal Communications Commission’s (FCC’s) Low-income Broadband Lifeline Pilot Projects, which ran from 2013 to 2014. The program worked with 14 private telecommunications firms to subsidize household broadband adoption for low-income households by providing discounted monthly and equipment costs. Low-income households are an important component of the broadband adoption puzzle: between 2003 and 2013, the adoption gap between low-income and high-income households actually increased by 5% points. This paper focuses on two specific FCC Broadband Lifeline Pilot projects that allowed consumers to make choices among different options, such as data allowance, speed, and wireless vs. wired connections. Conditional logit models are used to develop estimates of consumer’s willingness-to-pay for specific broadband attributes. The results indicate that low-income consumers have a preference for smartphone connections (versus aircards) – and that this effect is even more pronounced for those households earning less than $20,000; that low-income consumers have a preference for wired connections (versus wireless); and that there is evidence that low-income consumers are willing to pay for an extra GB of data each month – but not for the speed of their connection.     

Impacts of handset bundling on mobile data usage: The case of Finland

Promotion of the adoption of new services has emerged as a possible driver for the regulation of handset bundling and subsidies. Handset bundling, however, has complex implications not only on mobile data service adoption, the focus of this research, but also more broadly on the mobile market dynamics. Due to the complexity, regulators have difficulties in anticipating the possible resulting impacts. Using a case study, expert interviews, and usage measurements as research method, an empirical framework was constructed to make the service usage impacts more explicit. The framework enables the identification of the regulator's steering options and their qualitative impacts. Results are based on observations before and after the change of law on handset bundling in the Finnish market. According to the findings, handset bundling regulation is a possible but risky tool for steering the market.     

Characteristics and mobile Internet use intensity of consumers with different types of advanced handsets: An exploratory empirical study of iPhone,Android and other web-enabled mobile users in Germany

This work explores personal characteristics and mobile Internet (MI) use behaviors of consumers equipped with four distinct types of advanced handsets for accessing the Internet via cellular radio infrastructures of mobile network operators (MNO). Furthermore, it investigates the extent to which personal and mobile appliance characteristics explain variance in actual MI use intensity. Data on two demographic variables, three MNO relationship characteristics and actual MI use intensity (average monthly volume of mobile IP traffic generated by a subscriber in May and June 2011) of 9321 adult consumers with a flat MI pricing scheme are extracted from customer files of the German subsidiary of a large international MNO. 959, 2213, 2410 and 3739 of the sample members use an Apple iPhone 3, an Apple iPhone 4, a model running with Google’s Android operating system (OS) and other MI-enabled mobile OS/phone types, respectively. Compared to the adult population in Germany, persons at least 50 years of age are clearly underrepresented among MI adopters with the four studied device types. Differences between the four phone type groups with regard to gender, age, time from enrollment and MI use experience emerge as statistically significant, but they achieve only minor substantial relevance. MI use intensity is highly positively skewed: In each of the four appliance groups, a small number of users disproportionately add to the total MI traffic generated by the subjects. Consumers’ advanced OS/handset type strongly contributes towards explaining MI use intensity variance. iPhone subscribers generate more traffic than Android customers who in turn show a higher MI activity level than individuals running other web-enabled mobile models. Age is the only studied personal characteristic consistently showing a (negative) association with MI usage, which both is statistically and materially significant. Conclusions are drawn for MNO on MI marketing issues. Implications of study limitations for research on MI adoption and use behaviors on the MI are also outlined.     

The evolution of mobile communications in Europe: The transition from the second to the third generation

This paper analyses the evolution of the mobile communications industry in the European Union. The research focuses its interest on the different roles played by the regulator in Europe and in other regions of the world (mainly the US). The diffusion of GSM was extraordinarily fast in Europe, mainly due to the adoption of a unified standard from inception. This rapid diffusion has resulted in an important competitive advantage for European operators. Interestingly, while the regulator acted similarly in the case of UMTS, the development of the latter has faced many problems and, presently, its diffusion is still low (about 5% in the EU). The paper also offers basic information on market structure that may be useful for extracting some preliminary conclusions about the degree of rivalry within the industry and the differences that can be observed between European countries.     

Exploring the mass adoption of third-generation (3G) mobile phones in Taiwan

Given that no all new mobile telecommunications technology are accepted by the mass market, this study aims to understand the mass adoption of third-generation (3G) mobile phones that is hypothesized to comprise three consumer perceptions: new technology, new service, and new handset. Based on the theoretical framework of a consumer's decision making process, an empirical study of the mass adoption of 3G mobile phones in Taiwan was conducted. This study demonstrated that perceived utility of a new mobile service was a key factor that resulted in mass adoption. Further, it was found that perceived utility of a new handset directly stimulate consumers to purchase 3G mobile phones. Perceived risk and perceived expense are not negatively correlated with intentions as hypothesized. Moreover, perceived no need was another key factor that inhibited adoption and purchase intention.     

Communication satellites for rural development

The author points out that telecommunications in rural areas are an essential infrastructure for development, and that appropriately designed satellites could form an important part of rural communications technology. He argues that hybrid systems involving clusters of communities, served by a single ground station and rural radio telephone interconnection, are likely to be lower cost than all-satellite or terrestrial-only systems.     

The competition among mobile network operators in the telecommunication supply chain

In the mobile telecommunication sector, the high competitiveness has increased the complexity of strategic interactions among operators. As the vertical integration has become anything but a choice and not a compelling technical solution, the contest takes place at different levels of the components of the operator value chain: the network infrastructure, the service development and supply, and the relationship with consumers.Mobile virtual network operators act as retailers and concentrate on the last segment of the value chain by establishing commercial agreements with hosting network operators, which act as manufacturers, to get access to radio communications infrastructure. Productive processes of mobile services offered by operators are different and this difference is imperceptible to customers. Processes difference mainly consists in the infrastructural diversity of the operators and implies different consequences on each network service element.A model has been defined to analyze the consequences of such diversity in the competition among HNOs, MNOs, and MVNOs by focusing the attention on the characteristics of the call path, in dependence of the types of operators. In fact, many variables interact to define the call path, such as marginal costs and revenues, infrastructural investments, and interconnection charges among operators. The analysis of the results, obtained by the model, gives information on variations of retail prices, market shares, and profit allotment, to adopt the proper strategies. In particular, the model results shed light on how certain MVNOs should enter the markets and adopt a collaborative strategy with HNOs. The model owns the capability of being applied to different contexts, thus representing for the regulator a potential instrument of relevant usefulness.     

Regulation and competition in the European mobile communications industry: An examination of the implementation of mobile number portability

Over the past two decades, the mobile communications industry has seen a considerable drop in the consumer switching charges made by service providers in order to promote effective competition and ensure a level playing field for new market entrants. Mobile Number Portability (MNP) is an important regulatory measure taken to reduce switching costs, and it is believed to play an important role in fostering competition in the mobile market. MNP implementation has varied significantly across European Union countries, particularly with respect to porting time and customer fees, both of which are important factors when deciding whether to switch to another provider. The research examines the effects of MNP implementation on competition in the European mobile communications industry. The study findings indicate that subscriber churn rates are negatively affected by both the level of charges levied on subscribers wishing to maintain their current number (porting) when switching mobile providers and the length of time required to switch. The implications of the effectiveness of MNP regulation for competition in the mobile communications industry are discussed.