How Strong Are the Effects of Technological Disruption? Smartphones' Impacts on Internet and Cable TV Services Consumption

Emerging technologies have created disruptions in organizational, business process and industry contexts. They act as shocks to a system. We focus on a retail telecom service provider's offerings of different bundles, including mobile phones, Internet and cable TV services. We conduct empirical regularities analysis for Singapore, which was affected by the emergence of smartphones in 2009. We assess the impacts on the service bundle choices of a provider's customers. We analyze customer switching among service bundles involving three services. We compute switching probabilities for each of the service levels offered, as well as between bundles. We use Markov chain transition analysis to describe the patterns. We find evidence for: smartphone effects on the contents of service demand; substitution between different kinds of Internet services; and migration of video consumption from cable TV to mobile services. Our results provide a basis for improved management of retail services bundling and pricing strategies.

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