Kim Moon-Soo, Kim Ho, Journal of Internet Computing and Services, Vol. 7, No. 2, pp. 93-102, Apr. 2006
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Keywords: Telecommunications, Diffusion, Critical Mass, Network Evolution, Circuit-based Service, Pocket-based Service

Abstract

Traditionally, diffusion of telecommunications services has been considerably affected by presence of critical mass and network externalities, and thus shown the so-called late take-off phenomenon. However, as telecommunications network evolves from circuit switching to packet switching, enabling diverse new services such as Internet access, Internet banking and web hosting, it seems this traditional diffusion patterns are changing. By comparing diffusion of the packet-based services with those of circuit-based services and durable goods, we have found the late take-off phenomenon is not involved in diffusion of newly introduced the packet-based services. Moreover, we concluded diffusion of the packet-based services is much faster than that of durable goods, thus showing early take-off phenomenon. Based on this empirical result, we suggest Telcos and ISPs should pay as much attention to the growth state as the introduction stage in order for their packet-based services to be successful in the markets.

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