Testing an Empirical Model for the Value Network of the Mobile Communication Industry in Korea

Abstract

The mobile communication industry evolves into a mobile communication industry ecosystem led by new keystone players (i.e., Apple and Google) and reflects the expansion of overall industrial competitiveness in size through conversion with other businesses. In this study, the modeling was done in a systematic method to derive the answers to the questions such as, which functions in the value chains of mobile communication industry contribute most to profit creation, what is the key resource, and what the new business model is. This study attempts to objectively identify derivation of factors and correlations between the configuration factors for competitiveness expansion for each industry. Specifically, we developed a dynamic model to predict the overall industry movement by theoretically establishing the modelling concept about value networking of the mobile communication industry ecosystem. Using the system dynamics methodology, coupled with professional interviews, this paper empirically tests the value network model that reflects open mobile communication ecosystem. The results show that the ecosystem of the mobile communication industry is evolving into an open form with the surfacing of portals and terminal production companies, suggesting the collapse of the traditional structure (Walled Garden).