An investigation of the relationship between behavioral processes, motivation, investments in the service business and service revenue

Despite the established benefits of services in manufacturing companies, very few managers are motivated to invest resources in extending the service business. On the basis of a combination of qualitative and quantitative research approaches, we illustrate that managers cannot be easily motivated. Managerial motivation to extend the service business in manufacturing companies is more like a process that must grow organically. To do so, managers have to overcome some of the typical behavioral processes of manufacturing companies. In greater detail, we explore how the disbelief in the financial opportunities of services risk aversion in exploiting strategic opportunities, setting overambitious objectives and an overemphasis on obvious causalities limit managerial motivation to extend the service business. If manufacturing companies can overcome these behavioral processes, the managerial motivation will increase, leading to more investments in the service business and thus enhancing service revenue and overall profitability.     

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.     

中移动百日维新

通过更加开放的合作策略,中国最大的移动运营商希望能够掌控未来的移动互联网。去年这个时候,在通信圈的一次聚会上,上台发言的项方伟忍不住又一次抱怨起中国移动通信集团公司(中移动)对SP的"不公平"政策,虽然台下正坐着中移动数据业务部门的负责人。     

Diffusion and competitive relationship of mobile telephone service in Guatemala: An empirical analysis

The purpose of this paper is to analyze the characteristics of diffusion process of mobile telephone service and the competitive relationships between mobile and fixed-line services in Guatemalan telecommunications market. We investigated the best-suited model to explain the diffusion process of mobile telephone in Guatemala by estimating diffusion curves using empirical data. Moreover, we explored affecting factors which characterize the diffusion pattern of mobile telephony in Guatemala through statistical analysis. Finally, in order to understand the effects of competition in the diffusion process of Guatemalan mobile phone service, we attempted to clarify the competitive relationship between mobile and fixed-line services using the Lotka-Volterra model. As a result, the logistic model was found to be the best model for describing the diffusion pattern. Moreover, investment in telecommunications, the subscribers of fixed-line services, and the number of operators in mobile market were found as significant determinants of mobile diffusion process. Results from the Lotka-Volterra model showed that the relationship between mobile and fixed-line services has changed from pure competition to amensalism.     

IS MULTIMEDIA CONVERGENCE TO BE WELCOMED?*

This paper considers the consumer implications of the process of convergence across multimedia and telecoms markets. Convergence starts when one firm begins to sell products in hitherto separate horizontal markets competing against rivals active in just one or another of the markets. Convergence creates a strategic link between the markets which alters the price levels, creates the possibility of bundle prices, and creates winners and losers in the population. Partial convergence (e.g., a merged provider of telephony and internet services vs. independent sellers of telephony or internet broadband) lowers prices in the less competitive sector, raises them in the more competitive sector and raises the total prices paid by consumers active in both sectors as compared to the counter‐factual of no convergence. Full convergence (e.g., multiple firms offering TV and internet bundles) leads to deep discounts for bundle purchases but no reductions in stand alone prices paid by consumers in only one of the converging sectors. The bundle on bundle competition is so fierce that profits for all converging firms are reduced compared to the counter‐factual of partial convergence.     

The role of mobile network operators in next-generation public safety services

Field of researchThis research is in the field of public safety communications in mobile broadband 4G/5G networks. The focus is on mobile network operators and their business opportunities in the public safety market.PurposeThe purpose of this research is to provide a review of ongoing public safety mobile broadband projects in which mobile operators play a key role. In addition, a business model analysis is presented to determine the role of mobile operators in these projects. A comparison of the two key business models is also included to reveal their general characteristics.Methods and dataThe research used a qualitative method, an inductive case study. This method was used to draw general conclusions from a small number of case studies based on ongoing public safety mobile broadband projects. The Casadesus-Masanell and Ricart framework and the business model canvas were used to analyse and compare the two key business models discussed. Data were collected from a variety of sources, including company reports, press releases, international events and conferences, and selected interviews with managers in charge.FindingsThe results show that mobile operators have new business opportunities in the public safety market. Their existing mobile networks can be used for public safety services with certain enhancements. Within existing projects, mobile operators have different business models. The two analysed models were found to require different resources and offer different business opportunities for mobile operators. Procurement authorities responsible for selecting business models are encouraged to pay attention to the choice of model based on, for example, strategic objectives.ValueVery little research has been done on the business opportunities of mobile operators in the public safety market. In this area, this study lays the groundwork for new research. Procurement authorities can use the results when deciding on the business model. Mobile operators can benefit from these results by better understanding their own roles in public safety projects and when assessing the business opportunities of a particular project.     

Between a rock and a hard place: Recession and telecoms taxation

Excessive taxation in the telecoms services sector is rarely found in developed economies as it hinders high technology investments, confines innovation and eventually impedes economic growth. Recession eventually complicates this process. In this paper the repercussions of multi-layer service taxation on the Greek mobile sector during the last five years are studied. It is found that public revenues, companies and subscribers would significantly benefit from a direct decrease of the special levy imposed on the use of mobile services today. An econometric model that links the consumption propensity of mobile voice service usage with the disposable income of the users and the price of the product is applied. The results of this research indicate that the adoption of high sector specific service taxes with the objective of increasing government revenues creates an economic distortion that lowers service usage, shrinks sector revenues, and, ultimately, jeopardizes the competitiveness of the mobile telecommunications sector.     

Developing network insight

A challenge facing organizations is that of amalgamating possibilities which do not exist in a transparent and concentrated form, but rather as dispersed individual cognitive ‘pictures’ perceived by managers embedded in business networks. Based on our research of business networks involving manufacturers of consumer goods, pharmaceutical companies, producers of semiconductors and telecommunication and utility service providers, we propose the concept of network insight, which does not consist merely of extant pictures held by individual managers, but is grounded in the practice of inter-firm exchange. We argue that developing network insight is a managerial challenge encompassing the amalgamation of dispersed pieces of atomized network pictures through heedful, multilateral interactions. Such a managerial activity transcends the task-specific knowledge base of managerial cognition and leads to objectified organizational learning within a business network. Managers that develop insight in business networks are able to mobilize other actors and create a competitive advantage for their organization that is crucial for innovation and growth.     

Municipal electric utilities’ role in telecommunications services

Municipal electric utilities (MEUs) are increasingly expanding into telecommunications services. Such entry is interesting in several respects. First, MEUs marry two potential pathways for the growth of telecommunications access infrastructure and services: public ownership of last-mile facilities and electric power company expansion into telecommunications. Second, municipalities are key early adopters of next generation access technology in the form of both fiber-to-the-home (FTTH) and broadband wireless (e.g., WiMax) systems. Third, MEUs are at the nexus of the debate over the proper role for local government in promoting broadband Internet access. Most homes in the United States are served by investor-owned local telephone and cable television providers, using company-owned wireline infrastructure. These providers have generally opposed municipal entry, arguing that it will crowd out private investment and represents an unfair and less efficient form of competition. A number of states have acted to limit—or in some cases—to promote such entry. Before engaging in this debate, it is necessary to have a clearer picture of the current state of municipal entry and the local demographic, cost, industry, and policy factors that influence its evolution. To address this need, this paper reports the results of an empirical analysis of MEUs that provide communications services to the public. This analysis shows that MEUs are more likely to offer such services if they also provide internal communication services to support their electric utility operations (scope economies); are relatively close to metropolitan areas (lower backhaul costs); are in markets with fewer competitive alternatives (cable modem and DSL service availability limited); and which are less encumbered by regulatory barriers to entry (in communities in states which do not restrict municipal entry into telecommunication services). Of these results, the competitive impacts are the least straight-forward to interpret, suggesting richer dynamics and avenues for further research.     

The phoneless in the broadband age: A pilot study in Massachusetts

Questions about universal service continue to evolve as information and communication technology advances, bringing new platforms, services, and business models. Concerns about exclusion remain, particularly in times of transition to new technologies and platforms. While the universal service literature is rich in econometric studies that indicate the drivers of household telephone penetration, without qualitative data directly from those households that experience phonelessness, we cannot understand the causes well enough to design effective policy. This research explores why people are phoneless in the current environment of increased platform and business model choices. Particular focus is placed on understanding the relationship between new technology, platforms and business models and phonelessness. Data is obtained from surveys completed by approximately 100 individuals in Massachusetts who are currently without any voice connection, either landline or mobile, or have been sometime in the past ten years. The survey includes questions about different platforms and communication services in order to learn how they have led to phonelessness. The results of the pilot study show that the vast majority of phoneless households do not choose to be phoneless. The study also shows that the most frequent causes of phonelessness in this population are unemployment and unpredictable bills. Many instances of unpredictable bills leading to phonelessness occur with wireless service or bundled services but are the result of business models for service provision rather than the platforms themselves. Prepaid wireless service is a market-based solution that helps households prevent phonelessness by reducing unpredictability. Universal service policy for voice and broadband can better reduce exclusion with greater attention to business models and practices versus technologies and platforms, and increased emphasis on prepaid service to reduce unpredictability.     

Application and performance impact of stage–gate systems – the role services in the firm’s business focus

Although service innovation is important, knowledge of new product and service development, including the positive effect of stage‐and‐gate‐type systems, has been derived almost exclusively from studies in the manufacturing sector. In the present paper, we address two important questions: How do differences in the firm’s business focus, which describes whether a firm puts more emphasis on products or services in its business activities, influence the usage of such formal innovation processes? Is stage‐and‐gate‐type systems’ impact on innovation program performance contingent on the firm’s business focus? Unlike previous studies, we not only differentiate service and manufacturing by industry classification codes but also apply a continuous measure to take into account the blurring of boundaries between the manufacturing and service businesses. Based on a comprehensive discussion of service‐specific characteristics and their implications for innovation management and using a cross‐industry, multi‐informant sample of innovation programs from 272 firms with 1,985 informants, we find empirical support for firms with a stronger focus on the service business being less likely to use stage‐and‐gate‐type systems. Furthermore, the use of stage‐and‐gate‐type systems fosters innovation program performance, and this effect becomes stronger as the business focus shifts toward services. This result implies that service‐based firms can benefit from stage‐and‐gate‐type systems to a greater extent than product‐based firms. Our research also demonstrates the gap between the desired level of innovation process formalization and its current usage in practice, especially for firms with a dominating service business.     

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.     

Are OTT messaging and mobile telecommunication an interrelated market? An empirical analysis

OTT messengers such as Facebook and WhatsApp have gained wide popularity among mobile users while the traffic of text messaging is in strong decline. As such, there is a debate over whether both services are interrelated and constitute a joint product market, which has important implications for the current wave of mergers in the mobile industry and regulation policy. To the best of our knowledge, this work is the first to provide an empirical analysis of how the consumption of OTT messengers affects demand for text messaging and mobile voice services. We make use of an innovative dataset which includes very detailed information on smartphone usage in Norway and consider a novel approach to address this question which is embedded in the complexity of two-sided markets. Interestingly, our findings suggest that OTT messengers complement demand for traditional mobile telecommunication services for this context. Consequently, both markets are interrelated but do not constitute a joint market from the perspective of competition policy in Norway. Moreover, we find an explanation for why reductions of text messaging usage have been so drastic in some countries and an analogous development for mobile voice is rather unlikely. Finally, our empirical results provide a new perspective on the modelling of consumer utility in communication networks in the theoretical literature.     

Heading for new shores: Do service and hybrid innovations outperform product innovations in industrial companies?

This study investigates the financial outcomes of product, service, and hybrid innovations in industrial markets. To date, empirical research has focused on product innovations, yet industrial firms are increasingly competing with innovative services to maintain their competitive edge. This study assesses the financial impact of service and hybrid innovations compared with more traditional product innovations. We develop a unique data set that combines information on companies' innovation activities with objective financial data. From a sample of 348 German industrial firms, the analysis reveals that service innovations do not outperform product innovations in industrial markets. A focus on service innovations only pays off in highly price-conscious markets. In contrast, hybrid innovations, referring to the simultaneous market introduction of new products and services, have a positive effect on firm performance above and beyond pure product innovations. This effect is particularly pronounced in competitive markets and under conditions of high customer concentration. In sum, this study demonstrates that hybrid innovations outperform both, pure product and service innovations in industrial markets.     

Demand‐side strategy,relational advantage,and partner‐driven corporate scope: The case for client‐led diversification

Research Summary: We advance research on corporate diversification by joining insights from the demand‐side and relational views in strategy to offer a novel theory of client‐led diversification. We propose that client‐led diversification results from a combination of the customer‐driven opportunities emphasized in the demand‐side view and the creation of added value through relational assets that is a central tenet of the relational view. Furthermore, we hypothesize that suppliers’ client‐specific knowledge, clients’ relational commitment to suppliers, and growth opportunities in clients’ markets (relative to the suppliers’ own markets) will magnify the client‐led diversification effect. We test our hypotheses using a longitudinal dataset on patent law firms and their diversification into new domains of patent prosecution work for their corporate clients. Managerial Summary: Explanations of why firms diversify into new lines of business have largely concerned the redeployment of underutilized resources, with little regard to opportunities or influences stemming from firms’ existing customers. In our article, we show how the changing scope of business needs from a knowledge‐based supplier firm's set of existing clients is a central driver of supplier‐firm diversification, and this is especially the case when the level of relational assets shared between a supplier and its clients is higher. In a competitive landscape where suppliers compete intensively for the business of clients, our results show how managers can increase the likelihood of capturing additional business from its existing exchange relationships rather than bearing the risks of seeking new exchange relationships.     

Evaluation of mobile services and substantial adoption factors with Analytic Hierarchy Process (AHP)

Emergence of new technological innovations in networks, platforms, and applications has enabled service providers to gain back their massive investment in their infrastructures. However, due to lagging adoption, many service innovations have failed to generate profit. The adoption of different mobile service categories depends on several factors. The current explorative study aims to use Analytic Hierarchy Process (AHP) to identify the most relevant mobile services for consumers and the factors driving the adoption. The results of the AHP analyses indicate that functionality of services is of utmost important for the majority of respondents. The results reveal that basic mobile communication services are the most preferred ones, although several services within different categories are available. The results have important implications for mobile network operators, service and application providers on how to develop and implement specific mobile services. The current study also offers new insights for researchers by showing that AHP is applicable to analyze consumers' preferences.     

A layered United States Universal Service Fund for an everything-over-IP world

Support through the United States Federal Universal Service Fund for high-cost areas has been principally defined in terms of telephone service. Fund growth due to increases in wireless lines and implicit support for broadband infrastructure has created an untenable situation, and fundamental reform is expected. The cause underlying this growth is convergence between the telephone network, wireless networks, the Internet, and cable networks. This convergence will pose additional serious long-term challenges to the fund. This paper proposes a restructuring of the high-cost funds based on a layered model. Both contributions and distributions are focused on network infrastructure, without distinction between voice and broadband. The proposal uses a new definition of communication services to guarantee technology neutrality, and includes service area reform and cost efficiency measures. This layered approach repositions the fund for future converged networks.     

Tensions and ties in social media networks: Towards a model of understanding business relationship development and business performance enhancement through the use of LinkedIn

The era of social media networks has created significant opportunities for business relationship development yet there exists a paucity of research in this area. To address this, this paper identifies four key tensions within the current literature: relational versus transactional exchanges, emergent versus strategic social media network development, the pace of social media network formation versus the development of trust, and the notions of sharing and reciprocity versus competitive advantage. This study draws on the principles of netnography, incorporating data from 554 LinkedIn group interactions and 12 interviews with professionals in one global industry to provide insight into business relationship development stemming from one social media network. Significant contributions to theoretical and practical knowledge are made through the recognition of tensions in the literature, the application of the notion of Granovetter's ties to a contemporary context and the novel use of netnography. Furthermore, the resultant model conceptualises the use of social media networking in building networks and relationships which lead to new business and enhance business performance.     

Market power,regulatory convergence,and the role of data in digital markets

The increased economic importance of digital services has profoundly changed the power structure in telecommunications and media markets. Although these services sometimes directly compete with traditional telecommunications services, the regulatory obligations for both players differ significantly. This article discusses three important areas deemed relevant in order to define a coherent regulatory framework and to account for the specific peculiarities of digital markets: First, challenges associated with assessing market power in digital markets. Second, challenges in harmonizing different regulatory obligations for digital services, and third, the vital role of data and data protection in the context of data-driven business models.     

Internet of things technologies,digital servitization and business model innovation in BtoB manufacturing firms

Technologies like the Internet of Things (IoT) are offering new opportunities and posing serious challenges to firms, forcing them to create entirely new business models, migrating from the conventional product-centric approaches to (digitally-based) service-oriented ones. This paper – following a qualitative research method – aims at describing the service-oriented impact of IoT technologies on firms' business models, with a particular focus on opportunities and challenges for BtoB manufacturing firms.Being the impact of IoT technologies on businesses a quite recent research stream, to date scarce attention has been devoted to the topic with specific attention to its impact on service-oriented business models in manufacturing firms. The paper contributes in this research stream in different ways. It proposes a map of digital servitization that helps in understanding firms' strategic transitions caused by technologies, making both theoretical and managerial contributions. Firstly, the research underlines the impact of the firms' sales model as a strategic factor in shaping firms' digital servitization strategies. In addition, three progressive levels of digital servitization complexity are identified, namely product- process- and outcome-oriented, that are based on an increasing use of IOT technologies and have specific challenges and opportunities.