Background and Motivation

Chapter 1 Introduction

1.1 Background and Motivation

As the user number of smartphone and smart device constantly rises up, the number of mobile application provider and mobile application (app) in different categories has also risen up tremendously. In the report of Mary Meeker and Liang Wu, 2012 KPCB Internet Trends Year-End Update and KPCB Internet Trends 2013, pointed out the following statistics of smart phone and smart device. Up to 2013 May, the number of global smartphone subscriber has grown to 1.5 billion with growth rate at 31%, and only accounts 21% of global mobile phone subscriber. There was 29% of adults in USA owns tablet/eReader until 2012, while there was less than 2% in 2009.

The global mobile traffic has grown to 15% of global internet traffic in 2013, growing 1.5 times per year, whereas the global mobile traffic was only 1% of global internet traffic in 2009. In India, the mobile traffic has surpassed traditional computer traffic in the second half of 2009. The amount of global mobile device, including smart phone and tablet, will surpass the amount of traditional computer, including desktop computer and notebook, in the second quarter of 2013. The revenue produced by global mobile App, including charge app and advertising revenue, has grown from 700 million USD in 2008 to 19 billion USD in 2012 (Mary Meeker & Liang Wu,

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2012, 2013). According to the news from emgadget.com, the amount of mobile app of the top two popular mobile app platforms, Google play, used to call Android market, and App store had reached 700,000 in October 2012 and 900,000 in June 2013 separately, and both platforms are considered to hit 1 million apps in 2013, despite the fact that both platforms were established in less than 5 years ago (Steve Dent, 2012; Sharif Sakr, 2013; McCarra, 2013).

Although the above data shows that developing mobile app is promising, however, among the successful minority of all mobile apps, which attract vast amount of mobile users, many often get to the top in just one night, and then fall to the bottom the next morning. For example, the entertainment app, Draw Something, once had 1.2 million downloads in 10 days, 12 million downloads in 1 month, 20million downloads in 5 weeks, 100 million draws and 15 million active user per day in just few month, and 250 thousand USD revenue per day when there was a fever for it in first half of 2012, but then a year passed and the fever was gone, even if Draw Something 2 was released, the team of Draw Something was still dismissed (Sean Hollister, 2013; 夔蒽, 2013). Yet in another different example, the team manages to keep their popularity. Angry Birds, an entertainment app launched in 2010 by Finland developer, Rovio, and its team continues to release its serial app, Bad Piggies, Angry

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Birds: Star Wars and the upcoming new app, Angry Birds Go!(Francisco & London, 2013; “Angry Birds Go,” 2013). They success in maintaining their popularity and

preserve their achievement in the initial Angry Birds app, which is seldom seen in the mobile app market. Generally, mobile app users won’t remember the mobile app provider and only have some vague impression of the content and the name of the mobile app, and when the mobile app provider launch a new mobile app with a new look, they have to make the users rediscover the app without effectively using the good image they already built or the familiar users they already have in their original mobile app. So even if the original app was a great success with a lot of users, it may not drive the user number of the newly developed app.

In the related field of academic research, there has been a lot of studies focus on the adoption or continuous use of mobile service, and also on the user readopt or rebuy intention in the context of e-commerce or m-commerce (Table 1-1). In spite of the immense interest in the mobile device research field, few studies have aimed at discussing the transfer of existing achievement of original mobile app to the next mobile app. One of the unique studies is the work of Wang and Li (2012), which explore mobile services adoption from a brand-equity perspective. In the studies, they concentrated on the factors which can improve the brand-equity of the mobile service,

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because they believe that to transform the value of the mobile service into the value of the brand can make consumers buy things from the brand next time. Another study from Song, Zhang, Xu and Huang (2010) in the context of web service, however, concentrated on the factors that influence the transfer of the value from parent brand to its extension, but there are several differences between conventional web service and mobile service. According to some researches, mobile service has certain distinctive characteristic, which can derive value like ubiquity, personalization, flexibility, dissemination, usability, identifiability, and perceived enjoyment, and those value are not available in traditional wired e-commerce (Wei-Tsong Wang & Hui-Min Li, 2012;

Yi-Shun Wang, Hsin-Hui Lin, & Pin Luarn, 2006; Scharl, Dickinger, & Murphy, 2005a;

Mahatanankoon, Wen, & Lim, 2005; Siau, Lim, & Shen, 2001). And another major difference is that adopting a mobile app unlike adopting a web service because the former might require user to consider whether the space of their smartphone is enough for the app to occupy or whether the transmission quantity required for downloading the app surpass the user’s remain amount of their limit transmission quantity, according to their contract with their telecom provider. Since people may make different judgment in such different contexts, mobile and conventional web environment, this research examines the model proposed by Song, Zhang, Xu and Huang in mobile environment

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and makes changes if necessary.

To make the mobile app providers to survive or even strengthen their competitiveness in a market environment so full of opportunity yet having intense competition, this

Theoretical baseKey constructAdoption measureResearch contextRepresentative literature TAMPerceived usefulness;Behavioral intention;Mobile-technology-enabledFang et al., 2005-2006; Hong perceived ease of use;adoption intention; intentiontasks; mobile data services;and Tam, 2006; Li and Yeh, subjective norm; selfefficacy;to use; actual use behaviormobile shopping services;2010; Liu et al., 2010; Lu and enjoyment; networkmobile short messageSu, 2009; Ko et al., 2009; externalityservices; mobile paymentScharl et al., 2005; Schierz services; mobile healthcareet al., 2010; Shin, 2009; servicesThong et al., 2006; Wang et al., 2006; Wu et al., 2011 ISSMSystem quality/ease of use;Satisfaction; actual useMobile shopping services;Kim et al., 2009a; Lee and information/content quality;behaviormobile banking services;Chung, 2009; Wang and service quality; trustubiquitous computingLiao, 2007 services EDMConfirmationSatisfaction; continued usageMobile internet servicesThong et al., 2006 intention Trust-related theoriesDimensions of trust;Adoption intention; usageMobile shopping services;Kim et al., 2009b; Li and Yeh, innovation measures;intention; mobile trustmobile banking services2010; Lin, 2011 perceived value Culture-related theoriesCultural characteristics/Satisfaction; continued usageMobile internet servicesKao, 2009; Lee et al., 2007 dimensionsintention Service quality perspectivePerceived value; trust serviceAdoption intention; purchaseMobile value-added services;Kuo et al., 2009; Lin and quality; enjoyment; risk;intention; post-purchasemobile shopping services;Wang, 2006; Xu et al., 2011 personalizationintentionloyalty

Table 1-1 Summary of existing studies of m-service adoption (W.-T. Wang & Li, 2012)

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research aims at studying the factors which may increase the transfer of good image and users from original mobile app to newly developed mobile app, helping the app provider to get competitive advantage in developing new apps.