A New Modeling Approach Investigating the Diffusion Speed of Mobile Telecommunication Services in EU-15

The objective of this paper is to investigate the impact of the timedelay effect on the diffusion of mobile telecommunication services in EU. It has been proved from several studies that the time-delay between the awareness and the adoption phase of mobile services-potential users determines the speed of the mobile telecommunication service diffusion and can be used effectively for ranking or cluster purposes in cases when the diffusion of a new product in different countries is studied. The proposed modeling approach originates from the well-known logistic model where it is assumed that the ordinary contagion process does not take place instantly but after some certain amount of time. A proper modification of the proposed model described by a time lag ordinary differential equation can be solved analytically and its properties for several parameters’ combination are investigated. Moreover, a new diffusion speed index is proposed and the correlation between the time-delay index and the proposed diffusion speed index is examined. Finally the model is applied to real data concerning the mobile services diffusion in fifteen counties of EU from 1990 to 2002. Based on the estimated parameters of the model produced for each country a ranking and a clustering of the EU countries based on their derived diffusion speed and time-delay indexes are provided.