Early mover advantages: An empirical analysis of European mobile phone markets
This paper analyzes empirically whether and if so to what extent later entrants in the European mobile telephony industry have a disadvantage vis-à-vis incumbents and early mover entrants. To analyze this question a dynamic model of market share development and a series of static models are considered. There is clear evidence of early mover advantage, mainly caused by the influence of the penetration rate: it pays to enter when still few people have acquired a mobile telephone. Another important determining factor is the Herfindahl–Hirschman Index at the moment of entry: it is significantly easier to enter a highly concentrated industry. Finally, there are important differences between countries, possibly indicating the relative strength of the national regulators.
|Keywords||early mover advantages, entry, mobile telecommunication|
|JEL||Economics of Regulation (jel L51), Telecommunications (jel L96)|
|Persistent URL||dx.doi.org/10.1016/j.telpol.2007.08.006, hdl.handle.net/1765/16416|
Bijwaard, G.E, Janssen, M.C.W, & Maasland, E. (2008). Early mover advantages: An empirical analysis of European mobile phone markets. Telecommunications Policy, 32(3-4), 246–261. doi:10.1016/j.telpol.2007.08.006