Technology Standard Competition Analysis in the 4th Wireless Telecommunication Industry Using Evolutionary Game Theory

Abstract

In a given environment, individuals with genetic properties that are appropriate for the environment are more likely to survive or produce more offspring than those who are not. In a standard competition, technical standards suitable for the environment are more likely to win than those that do not. In the 4th wireless telecommunication industry, technology standard Worldwide Interoperability for Microwave Access (WiMAX) and Long Term Evolution (LTE) compete with each other. The early time of the 4th wireless telecommunication industry, WiMAX had been considered as a first-moving technology standard. The first-moving technology standard is very important due to its possibilities to make the players with the standard to be on the advantageous position in the industry. However, potential strong technology standard LTE substituted the position of WiMAX and become surviving technology in the industry. To understand and interpret this standard competition process, we use Evolutionary game theory as its research methodology and consider the quality features and quantitative features of patent. From this research, we find that (1) LTE is more suitable for the environment than WiMAX. So LTE survive from the competition even though LTE is not a first-moving technology standard. (2) In determining surviving technology standard, key consumers can have a much greater impact than a number of suppliers.