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Title: Exclusivity, bundling and switching in communications markets
Author: Burnett, Tim
Awarding Body: University of East Anglia
Current Institution: University of East Anglia
Date of Award: 2013
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This thesis empirically analyses two case studies of markets associated with high-tech goods or services. In both cases the analysis includes an extensive literature review and in-depth study of market characteristics. These serve to inform the investigations and also provide technical background. The first part of the thesis examines the international distribution of the Apple iPhone and the incentives of the manufacturerto distribute the product exclusively to mobile network operators. The study uses a novel application of a double-hurdle model to analyse a cross-sectional dataset of 187 countries featuring industry-specific and demographic variables drawn from both off-the-shelf sources and from an analysis of several hundred individual sources of evidence. The results show that the mechanisms determining the duration of exclusivity agreements differ from those factors determining their initial imposition. In addition, it is shown that the level of competitiveness and concentration in the downstream market are significant determinants of both the decision to sell in a country and the duration of any exclusivity agreements. The presence of competing technological standards is also shown to result in longer periods of exclusivity indicating slower diffusion of the product in these countries. The second part of the thesis empirically examines the incentives of individuals to switch provider of their household communication services in the presence of bundling of services. The study uses a random effects probit method to analyse survey data of 2,871 households' communication subscriptions. The results indicate that when service subscriptions are bundled there is a significant reduction in the likelihood of an individual switching their provider. Furthermore, this effect is intensified when the bundle includes services in which the provider specialises. The results of both studies are consistent with economic predictions of, respectively, the use of key differentiators by firms to gain competitive advantages, and the use of bundling to create switching costs for consumers. Both studies represent significant contributions to the study of vertical restraints, and consumer switching behaviour.
Supervisor: Not available Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available