Social Networks and Choice of Mobile Phone Operator
25 Pages Posted: 14 Nov 2006
Date Written: August 2005
The aim of this paper is to estimate the importance of (induced) network effects in the use of mobile telephones and the impact of the structure of social networks on a consumer's adoption decision. This is done using social network data obtained from a survey of second year undergraduate students at the University of Nottingham Business School. We find that students strongly coordinate their choice of mobile phone operators, but do this only for operators which charge a price difference between on- and off-net calls. Coordination is strongest within groups of students who frequently interact with each other, but weaker with students from outside their group. Furthermore, the students did not coordinate their choice of mobile handsets - there rather is a tendency to choose a different handset than the one used by their friends.
Keywords: network effects, social networks, mobile telecommunications, discrete choice
JEL Classification: D12, L96, M31
Suggested Citation: Suggested Citation