Demand-Side Perspective of Technology Substitution: Disadopting Landlines For Mobile Phones

Some technologies are quickly supplanted by innovations, yet others continue co-existing with new technologies. Why? A new technology becomes a substitute only when consumers disadopt the incumbent one. We propose that the consumer disadoption decision is affected by environmental and supply factors and consumer characteristics. The study’s context is landline to mobile phone substitution in eight EU countries. The results confirm the complex system effects in technology substitution such as the socio-technical regime, network effects, market structure; pricing; consumer learning, demographics and lifestyle. It appears that environmental and market factors are stronger predictors than features and usage of the new technology. Complementary services such as Internet connection further enhance landlines’ “stickiness”.