The Role Of Network Effects In The Diffusion Of China Mobile Telecommunications

Network effects are the core feature of mobile telecommunications, and play an essential role on the development of mobile telecommunications market. China telecommunication market has experienced several transformation and rest ruction. During this process, the mobile telecommunications have largely driven the whole telecommunication market. However, there are still many problems which affect the development of mobile telecommunications, such as industry structure, price regulation and so on. So it is very important to recognize the essence of the telecommunication products, and to know how the network effects work. However, nobody have ever given an rational explanation to such questions like how the network effects affect the mobile telecommunication and to what extent, and what factors mainly decide the customers consumption decisions and how the network effects work in this process.This paper mainly researches on the role of network effects in the diffusion of China mobile telecommunications, and makes a comparison between the fixed and mobile telecommunications.The contents of this paper mainly consist of three parts:Firstly, this paper contains large collections of various definitions of the network effects which are useful in the study. And this paper makes a comprehensive study on the research path of network effects.Secondly, after defining the research objects, this text establishes a dynamic model of mobile telephone subscription incorporating a network effect. Based on the comprehensive data, this text makes the model estimation using SPSS and analyzes the estimation results.Finally, this text makes a comparison between China mobile telecommunications and global mobile telecommunications, and further makes a comparison between mobile and fixed telecommunications.