Technology Attribute-Diffusion Pattern Nexus: Evidence from the Early Experiences of 3G Mobile Communications

The diffusion patterns of 3G cellular technologies indicate that the reality is not matching the optimistic estimates of various consulting firms regarding the size of the network. What factors influence the diffusion of rapidly developing network goods? This paper draws upon innovation diffusion literature and the early experiences of 3G mobile technologies to examine the influence of supply-side factors on the 3G diffusion trajectory. We also propose a model that classifies various 3G related attributes in terms of their influence on present utility vs. expected future utility and the mechanism of influence: via 3G device vs. via 3G network. The central argument of this paper is that while the breadth of offers has been wider in 3G compared to lower generation cellular technologies, there has been digression rather than progress on some dimensions (e.g., bulky 3G handsets, very short battery lives, small geographical coverage, and lower network externality effects). The problems are compounded by the lack of strategic pricing and industryregulator coordinations.