Innovative pricing effects: theory and practice in mobile Internet networks

Multidimensional products, such as telecommunications, often distinguish themselves by a considerable number of spillovers. The creator of the spillovers wants to commercialize the spillovers but cannot if the parameters on which the ability to charge is proprietary to another firm in the economy. These actors then need to agree upon an efficient pricing contract to be able to charge. As an effect, the direction of revenue in the transaction may not be self‐evident, turning previous customers into suppliers and vice versa. The paper presents data from the mobile Internet market to validate this claim empirically and make suggestions of possible solutions to the pricing problem facing these actors with the introduction of mobile multimedia.

[1]  Jens Beckert.  Agency, Entrepreneurs, and Institutional Change. The Role of Strategic Choice and Institutionalized Practices in Organizations , 1999 .

[2]  J. Schumpeter,et al.  The Theory of Economic Development , 2017 .

[3]  Gunnar Eliasson,et al.  Firm Objectives, Controls and Organization: The Use of Information and the Transfer of Knowledge within the Firm , 1995 .

[4]  F. Knight.  Some Fallacies in the Interpretation of Social Cost , 1924 .

[5]  Michael W. Lawless,et al.  Technology and Strategy: Conceptual Models and Diagnostics , 1994 .

[6]  S. Winter,et al.  An evolutionary theory of economic change , 1983 .

[7]  J. Schumpeter.  Capitalism, Socialism and Democracy , 1943 .

[8]  Gunnar Eliasson,et al.  Schumpeterian Innovation, Market Structure and the Stability of Industrial Development , 1986 .

[9]  R E Miles,et al.  Organizational strategy, structure, and process. , 1978, Academy of management review. Academy of Management.

[10]  P. Khandwalla.  The Effect of Different Types of Competition on the Use of Management Controls , 1972 .

[11]  Gunnar Eliasson,et al.  Modeling the experimentally organized economy: Complex dynamics in an empirical micro-macro model of endogenous economic growth , 1991 .

[12]  G. Eliasson,et al.  The biotechnological competence bloc , 1996 .

[13]  Paul DiMaggio.  Interest and Agency in Institutional Theory , 1988 .

[14]  P. Ahmed,et al.  Non‐linear innovation across the Internet , 2000 .

[15]  F. Knight.  The economic nature of the firm: From Risk, Uncertainty, and Profit , 2009 .

[16]  Anil K. Gupta,et al.  Business Unit Strategy, Managerial Characteristics, and Business Unit Effectiveness at Strategy Implementation , 1984 .

[17]  P. H. Friesen,et al.  Innovation in Conservative and Entrepreneurial Firms: Two Models of Strategic Momentum , 1982 .

[18]  Richard H. Day.  Disequilibrium economic dynamics: A post-Schumpeterian contribution , 1984 .

[19]  N. Fligstein,et al.  Social Skill and Institutional Theory , 1997 .

[20]  B. Klein,et al.  Vertical Integration, Appropriable Rents, and the Competitive Contracting Process , 1978, The Journal of Law and Economics.

[21]  F. Ramsey.  A Contribution to the Theory of Taxation , 1927 .

[22]  Paul R. Milgrom,et al.  Multitask Principal–Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design , 1991 .

[23]  C. R. Hinings,et al.  Organizational Diversity and Change in Institutional Theory , 1998 .

[24]  Wickham Skinner,et al.  Manufacturing: The Formidable Competitive Weapon , 1985 .

[25]  J. Tirole.  The Theory of Industrial Organization , 1988 .

[26]  Arthur Cecil Pigou,et al.  Wealth and Welfare. , 1913 .

[27]  Bengt Holmstrom,et al.  The Theory of Contracts , 1986 .

[28]  Gunnar Eliasson,et al.  Mobile Internet revenues: an empirical study of the I-mode portal , 2001, Internet Res..

[29]  Stan Metcalfe,et al.  Evolution and Economic Change , 1989 .

[30]  F. Hayek.  The economic nature of the firm: The use of knowledge in society , 1945 .

[31]  B. M. Mitchell,et al.  Telecommunications Pricing: Theory and Practice , 1991 .