Acceptance of Technology with Network Externalities: An Empirical Study of Internet Instant Messaging Services

ABSTRACT Many researchers have examined the technology acceptance model (TAM) that Davis (1986) created to predict the voluntary use of information systems. However, TAM's primary focus is on how ease of use and usefulness influence acceptance, without looking at the effects of network externalities. In this study, we examined adoption behavior involving Internet-based instant messaging services (IMS). A questionnaire was used to collect data on perceived usefulness, perceived ease of use, perceived number of users for external network utility, and technology utility. The results indicate an acceptable goodness-of-fit statistic for our proposed TAM model, which combines the original TAM concept and network externality theory. The results also support the importance of network externalities in considering IT acceptance. INTRODUCTION The success of any information systems development depends on a combination of user acceptance and advancements in technology. Davis's (1986, 1989) technology acceptance model (TAM) is one of the best-known approaches to explaining and predicting user acceptance of information systems. According to Davis, perceived usefulness (PU) and perceived ease of use (PEOU) are the two most important factors determining system usage. He defined PU as the degree to which a person believes that using a particular information system will enhance his or her job performance (Davis 1989); PEOU was defined as "the degree to which a person believes that using a particular information system would be free of effort." The TAM approach assumes that PU is influenced by PEOU - that is, systems that are perceived as easier to use are also perceived as being more useful (Venkatesh & Davis 2000). A long list of researchers have used various technologies to test, assess, and verify TAM, which included Adams, Nelson and Todd (1992), Agarwal and Prasad (1997), Bhattacherjee (2000), Chau (1996), Chau and Hu (2001), Chen and Lou (2002), Chin and Todd (1995), Davis (1989), Davis, Bagozzi, and Warshaw (1989), Doll, Hendrickson and Deng (1998), Gefen and Straub (1997), Hong. Thong, Wong and Tarn (2001), Hu and Chau (1999), Lucas and Spider (1999), Mathieson (1991), Moon and Kim (2001), Szajna (1994), Venkatesh and Davis (2000), Venkatesh, Speier, and Morris (2002), and Wober and Gretzel (2000) and some others. The technologies used to test the effectiveness of TAM include email, voice mail, word processors, spreadsheets, database programs, graphic systems, decision support systems, and the World-Wide Web browsers. In the majority of these studies, use of the TAM model was supported by the empirical results. However, there are other factors that influence behavioral intention to use (BI) and actual usage behavior (AB)-for instance, perceived utility from a network externality effect. According to Rohlfs (1974) and Katz and Shapiro (1985), network externality is the characteristic of change in product value according to the number of users. In short, the utility that a user derives from consuming a good or product increases as the number of consumers of the same good or product also increases (Katz & Shapiro 1986). Communication products serve as one example of merchandise for which network externality strongly influences user utility. Internet-based Instant Messaging Services (IMSs) are relatively recent communication products that possess network externality. User acceptance of an IMS may be determined not only by perceived usefulness or ease of use, but also by the network effect based on the number of users. According to marketing research conducted by Jupiter Media Metrix, 53.8 million Americans used an instant messaging product in their home at least once during September, 2001, an increase of 28 percent compared to September, 2000. A smaller but still significant number of Americans (13.4 million) used instant messaging at work during September of 2001 (Denison, 2002). The adoption behavior of IMS users is the primary focus of this study. …

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