The origins of new industries: the case of the mobile Internet

Abstract

This paper describes a model of new industry formation that is based on evolutionary theories of technical change. It represents the origins of new network industries as the interaction between multiple technological trajectories that are specific to a particular technology or broadly defined technological regime. The speed with which these multiple trajectories cause industry formation depends on their effective application to the most economical applications; this process occurs through the interaction between design hierarchies and market concepts. Growth in these initial applications causes sub-trajectories or sub-regimes, where competition in the new industry initially takes place, to emerge from the main trajectories. The model is applied to the mobile Internet, an industry that has just started to grow particularly in Japan and Korea.