Abstract

Growth models, based on the theory of diffusion of innovations, are highly proficient in developing an empirical understanding of country-wide diffusion of mobile services. The currently available literature lacks in explanation of the diffusion of successive generations (G’s) of mobile services in various countries. This study furthers the research by analyzing the diffusion of 2G through 4G in Germany, UK, France and Italy, the four largest economies of Europe. We select Bass, Gompertz and Simple Logistic growth models, to analyze the diffusion process, and forecast the adoption of 3G, 4G and 5G mobile broadband, in the four countries. A comparative analysis of the diffusion model parameters, and the forecasting accuracies, estimated through non-linear least-square regression, determines Gompertz and Simple Logistic model as best suited to explain 3G and 4G diffusion, and Bass model as best suited to explain 2G diffusion. Market potential for 3G, 4G and 5G is the highest in France, Germany and Italy, respectively. However, subscribers are more likely to make a direct jump from 2G to 4G in Italy and Germany, compared to UK and France where the gradual switch from 3G to 4G to 5G is likely to be much slower.

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