STANDARDIZATION IN THE WIRELESS INTERNET MARKET: LESSONS FROM JAPAN AND KOREA

Jeong-Yoo Kim, Taehun Jung and Nae‐Chan Lee

Pacific Economic Review, 2010, vol. 15, issue 5, 620-636

Abstract: The wireless Internet market has been growing rapidly since NTT DoCoMo first introduced the service in 1999. This paper provides a framework within which the wireless Internet market can be analysed so as to draw valuable policy implications. We show that if platforms are standardized: (i) social welfare is increased with the rational expectation of larger installed bases; (ii) the neutrality of a revenue-sharing ratio that is valid for non‐standardized network platforms is affected; and (iii) the collusive interconnection charge is lower than the social optimum insofar as the population mass of content providers is less dense than that of Internet users.

Date: 2010
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