Scaling the wall: Factors influencing the conditions for market entry in the mobile data market

Abstract

Advances in mobile technology have created a fertile ground for the development of new and innovative information and entertainment services. However, the road from development to commercialization of these services is one that is currently under construction. In this research, we seek to understand the relationships between developers of information services and the powerful mobile network operators that dominate the industry, which in turn shed light on the forces shaping the diversity of information sources on the mobile Internet. To understand these relationships, we have undertaken a research project in which we follow the attempts of a small firm to commercialize their information service in the United States. The project combines knowledge of industry structures with the first-hand market entry experience of a small firm. Results derived from the application of an institutional economics theoretical lens indicate that informal institutions, technology, and market power have combined to create the context for mobile services provision, which can be characterized as a highly fragmented market. This market fragmentation, together with technology, market power, and informal institutions, defines the choices application developers must make and indirectly determines the developers who will and will not be able to enter the market. © 2005 by International Federation for Information Processing.