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Research tasks
In practice, the project consists of eight research tasks, that utilize
various data collection methods holistically:
1. Value and utility of mobile services
2. Adoption of mobile services
3. Contextual and ubiquitous use of mobile services
4. Access alternatives to services and content
5. Mobile peer-to-peer usage and business models
6. Market-level diffusion of mobile devices and services
7. Handset bundling
8. Dynamic modeling of the mobile market
Task 1 - Value and utility of mobile services
The recent emergence of mobile Internet services, ubiquitous logic of
new mobile applications, new schemes in mobile broadband pricing
(bundled subscriptions, flat-rate tariffs) and increase in the
complexity of mobile devices and service delivery methods have all
raised the question how consumers really perceive the utility and costs
of mobile services. Mobile operators in Finland are currently
experimenting with various kinds of pricing schemes in mobile services.
Particularly mobile broadband data access pricing has experienced many
trials from time-based tariffs to flat-rate service pricing plans. This
area asks for new modeling techniques, and more importantly data that
supports empirical models. The MoMI project, among the first academic
initiatives in the world, can acquire accurate enough data from
end-users in Finland, and therefore to facilitate new quantitative
models.
On a micro-level consumers compare their marginal utility from using a
particular service to the marginal cost. Marginal utility varies from
service to another, and it embraces both utilitarian and hedonic value
people extract from the service. The cost of using the service, on the
other hand, can be strict monetary cost, effort of using the service or
opportunity cost of time. In addition, people consider the decision to
start using a particular service by taking future events into
consideration, too. For example, if the battery is low, people rarely
launch power-intensive services such as music playback or Web browsing
over WLAN.
The objective of the task is to model demand dynamics of mobile
services. In particular, the flat-rate impact of service/access pricing
and user behavior in considering their utility from service usage are
to be analyzed in detail. One of the purposes of the present research
track is to build quantitative models of micro-level user behavior and
service usage with available data. The results are used in evaluating
the suitability and role of new business models in driving emerging
mobile Internet services. Longitudinal analysis of new emerging mobile
Internet services in Finland is repeated continually in the MoMI
project, and the results are communicated to the academia, industry and
Finnish media.
Task 2 - Adoption of mobile services
One of the main venues for academic contribution is mobile service
adoption research. Earlier technology adoption research has looked for
determinants of usage intentions among end-users. This earlier
research, however, has not tackled the special attributes of mobile
services, such as context-dependence, physical restrictions, changing
nature of business logic and immature technologies.
A major objective of the present task is to understand how to better
model mobile service adoption process with structural equation
modeling. In addition, the links between user attributes, interest and
actual adoption of services are modeled in detail. An exemplary
research question would be: “Is the user interest towards
mobile email driven by expected utilitarian or hedonic benefits, and
how does the assumed interest result into trial usage and this further
to sustainable usage?” An extension of the mobile service
adoption research task involves the segmentation of end-user domain
based on e.g. smartphone usage behavior and motivational aspects.
Task 3 - Contextual and ubiquitous use of mobile services
Mobile services are used in quite a variety of situations. This mainly
results from the fact that people carry their mobile devices
everywhere, and new services are accessible irrespective of time and
location. Novel mobile Web 2.0, context-aware and ubiquitous services
are emerging that leverage new business models. The new handset-based
end-user research method provides data on location and time of
smartphone usage. All cell-id transitions, consumer actions with mobile
services, time of usage and even geographic GPS coordinates are logged
in the handset and are available for data mining purposes. This
provides a possibility to model the location dynamics of mobile nodes.
In addition, this provides a unique approach to continue contextual and
sociological modeling of mobile subscriber behavior and service usage.
Task 4 - Access alternatives to services and content
The number of radio interfaces in mobile devices in increasing. In
addition to the continuously evolving family of 3GPP standards,
technologies such as WLANs, Bluetooth, and DVB-H provide alternative
means to access content and services in the network. Furthermore, as
memory cards and hard drives continue to increase in capacity, more and
more content can be stored in the device and viewed or played back when
wanted.
Due to the increasing number of alternatives, considerable uncertainty
exists regarding the dominant ways of accessing different types of
mobile services and content in the future. The preference of users
regarding device formats (e.g. mobile phones, PDAs, ultra-mobile PCs,
laptops) and access technologies (e.g. WLAN, 3G) in different contexts
(e.g. indoor / outdoor, or home / office / on-the-move) has a
significant effect on the business of mobile operators as well as
content providers.
This task analyzes the current and future role of alternative radio
accesses and off-line playback for accessing different types of mobile
content and services (e.g. voice calls, e-mails, IM, news, music,
video). The paper analyzes the strengths and weaknesses of the
different access methods in different contexts, and attempts to
integrate empirical findings from today’s smartphone usage
data into a forward-looking techno-economic model.
As only a part of mobile services and content are utilizing the actual
2G/3G mobile networks, mobile network operators have limited visibility
to the ways their customers are actually using their mobile devices. In
our work, we are utilizing empirical data from a mobile handset-based
measurement platform that allows us to analyze service and content
usage utilizing also alternative radio accesses and off-line playback.
Based on available empirical data and supplementary expert interviews,
a quantitative techno-economic model is constructed for forecasting the
potential effects of alternative access methods on mobile
operators’ business. The model combines forecasts for
terminal feature penetration and network coverage, and calculates the
potential effects of alternative access methods to mobile operator
business.
Task 5 - Mobile peer-to-peer usage and business models
Peer-to-peer (P2P) technologies have gained significant popularity in
the Internet during recent years. Initially these technologies were
used only for file sharing, but now they are also applied to e.g.
communicating and broadcasting. Due to the popularity of these
services, questions about the applicability of P2P technologies in the
mobile domain have been raised. Various mobile P2P services are under
development and their standardization efforts have begun.
There is so far little information about the actual usage of mobile P2P
services. Gathering this information provides valuable insight about
the development of mobile P2P and serves as a basis for further
analysis regarding e.g. mobile P2P business models.
Task 6 - Market-level diffusion of mobile devices and services
The usage and diffusion of new mobile data services presents a lot of
potential for the current mobile industry actors and for new entrants
from the Internet world. The success of previously launched mobile data
services, however, has been varying. Identifying the underlying reasons
for the success and failure of different mobile data services would
enable the industry to better drive the diffusion of new services to
mass markets. Despite this, little accurate information on the adoption
and diffusion of mobile data services is currently available.
The objective of this research task is to characterize the diffusion of
mobile data services in Finland, to identify the drivers and barriers
of this phenomenon, and to forecast the future diffusion of mobile
devices and data services in the Finnish market.
Quantitative data on the real diffusion and usage patterns of mobile
devices and data services is collected using two separate measurement
methods: 1) Data collection based on mobile operators’
charging-oriented reporting systems provides information on e.g. the
Finnish mobile terminal installed base, mobile subscriber population,
and the usage of different data services by mobile subscribers. 2)
Packet data traffic measurement at the mobile operators’ GPRS
core network provides a profile of the “bit pipe”
packet data traffic to/from the Internet (e.g. terminal operating
systems, application protocols, browsing destinations). In addition,
qualitative expert interviews are conducted to supplement the
quantitative measurement data.
Task 7 - Handset bundling
The Finnish Ministry of Transport and Communications (MINTC) decided in
June 2005 to promote the adoption of advanced handsets and services by
proposing to allow handset bundling and subsidies for WCDMA handsets
for a limited time period. The law came into effect in April 2006. The
reasons of this policy change and its possible consequences are the key
motivation for our research. Bundling is interesting as one of the key
regulatory parameters of the Finnish national mobile market, but it
also is an important link between the national mobile cluster and the
international markets. This handset bundling study continues the
research on the impacts of handset bundling on mobile data usage
started during the LEAD and COIN projects in 2004-2007.
The goal of the study is to measure and analyze the actual impacts a
handset bundling strategy will have on the Finnish mobile
communications market. Possible measures are the renewal of the
technically old-fashioned handset base, changes in the
operators’ differentiation opportunities, changes in churn
rates, and operator control over the handset and its features. Also a
policy and impact benchmarking between Finland and South-Korea will be
done. In addition, the extension of the framework is applied in device
and service bundling. For example, Nokia’s strong position in
the device market provides interesting possibilities to leverage this
position also in bundling new mobile Internet services into handsets.
The merging of telecommunications and Internet worlds makes bundling
and platform strategies relevant to study from an objective point of
view.
Task 8 - Dynamic modeling of the mobile market
Developing and developed mobile markets have quite different evolution
paths in terms of experienced penetration growth, regulatory framework,
business models etc. Policy makers have to know how different policy
initiatives such as roaming regulation or handset bundling might affect
the dynamics of the market. Because the interrelationships between
market supply, demand and regulatory sides are complex, advanced
computational tools should be used in modeling market dynamics.
The objective of this research task is to develop a model of the
Finnish mobile market dynamics and to evaluate different policy
initiatives on mobile market structure and operations. The aim of the
task is to compare the Finnish market not only to other developed
markets but also to developing countries. A cross-country study setting
attempts to explain many of the results that are observed with other
research methods utilizing a limited amount of data available
(handset-based measurements). The outcomes of the dynamic modeling
exercise will also be used in developing the MOBI business game
further.
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