Firm level innovation diffusion of 3G mobile connections in international context

Abstract

Our objective is to explain the differences in the technology diffusion of 3G mobile phones at the firm level. Using a firm level diffusion model, we investigate: the effect of social globalization on within- and across-brand word-of-mouth communications; the impact of competitive fractionalization on the probability of adoption; and the effect of the population density on market potential. We use non-linear mixed modeling on pooled multi-country data from 123 firms in 40 countries to estimate a generalised firm level model. Our substantive findings are: social globalization has a positive impact on within-brand communications, and a negative impact on across-brand communications; competitive fractionalization has a negative impact on the probability of firm level adoption; and population density has a positive impact on the market potential. Finally, we demonstrate the model's validity using the model fit and predictive accuracy. Our findings will aid international managers in the evaluation of diverse international market forecasts for entries and regulators in their formulation of strategy and policy.