Intellectual Property Research Institute of Australia

IPRIA Working Paper Series

    Intellectual Property Research Institute of Australia Working Paper No. 11/2006

    Entry and Competitive Dynamics in the Mobile Telecommunications Market

    by

    Zi-Lin He, Kwanghui Lim, and Poh-Kam Wong

    Date: July 2006

    Abstract: “We propose an extension of the Gans-Stern (2003) framework that includes entry by existing firms. An incumbent firm possessing complementary assets and strong appropriability is in a formidable position (Teece, 1986). However, a de alio entrant can leverage complementary assets to enter along a new technological trajectory, and then develop appropriability. We illustrate how several mobile telecommunications firms (Ericsson, Nokia and Samsung) pursued this strategy to catch up with the market leader (Motorola). We also identify several shortcomings in Motorola’s approach: it was too inward-looking in developing technologies, but ironically not inward-looking enough in exploiting its most valuable patents.”

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