Abstract
In light of the growing importance of data network quality in the wireless industry, this study analyzes and compares efficiencies in management, service quality, network quality, and market in the 4G Long Term Evolution (LTE) wireless industry. For this purpose, a bootstrap data envelopment analysis (DEA) model using representative U.S. wireless carriers as decision making units (DMUs) was designed and conducted, with further verification through the Mann-Whitney U and Wilcoxon W test, to examine the differences in efficiency distribution. The results indicate that, in terms of efficiency distribution, network quality efficiency and market efficiency belongs to the same group as that which has high management efficiency. Based on these results, this paper suggests implications and strategic guidelines for wireless carriers for improvement in management efficiency.
Highlights
Communication services in the 21st century have witnessed a notable growth in the wireless market, driven by advances in long distance and satellite communication technologies
Firms falling under Quadrant C, which represents low network quality efficiency and low service quality efficiency, need to focus on network quality efficiency to increase their market share or to improve their management or market efficiency
Sprint Nextel in Quadrant A, which is currently focusing on customer service quality, should invest more in network quality than service quality while T-mobile, which is efficient in both aspects, should direct a portion of its investment in customer quality service to network quality in order to improve its management efficiency
Summary
Communication services in the 21st century have witnessed a notable growth in the wireless market, driven by advances in long distance and satellite communication technologies. Advances in wireless technology from analogue to digital technology and IMT-2000, and again to 4G Long Term Evolution (LTE) technology have brought a shift in market priority from voice communication to data network communication. The advent of new technology has intensified the competition in communication market to motivate firms to place greater efforts in improving service quality, whose most important factor shifted to network quality over voice quality with the technological changes. With the growing importance of network quality, whether the priority of functional quality over technical quality still holds in the context of the wireless market is questionable. In a highly competitive market such as wireless communication services, identifying the most efficient area to focus resources and efforts can be critical for achieving a high business performance and good market position, and in turn, to becoming the leading firm in the market [4]
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