Modelling Tele-economics systems using Business Dynamics

Abstract

There has been a major development in the industry of mobile phone devices during the last few years. From being only a device which could make phone calls and send text messages, the smartphones of today have become just as powerful as a computer with a wide range of functionality. With this development, the mobile operating systems have become far more advanced and are now similar to what we have in the desktop computer environment, creating a market for 3rd party software developers and service providers.The aim of this thesis is to gain an understanding of the market of mobile operating systems for smartphones, and to investigate the dynamics in the ecosystem surrounding these operating systems. An exploratory research of six major actors in this market and an analysis of the different competitive strategies and approaches have been conducted. In addition, a dynamic model using John D. Sterman s business dynamics framework has been developed. The model serves as a basis for a set of simulation runs in order to examine the effect of different characteristics in a competitive setting.Based on the analysis and the model simulations, the following is proposed:1. Controlling app distribution and providing additional services are found to be important factors in the mobile OS market based on three reasons: increased revenue, increased control over customers and as a necessary competitive feature.2. Gaining an advantage in one of three characteristics additional services, apps or device selection is enough to affect the outcome of the competition.3. With a low selection of devices, it is important to become a market leader in terms of additional services or apps.4. In order to gain a significant lead in market share compared to a competitor, a large selection of devices is important.