Does new technology always win? Study on diffusion route of new technology and related factors

摘要

On the basis of sufficient analysis on product value and consumer’s technology preference, we improve Joseph Farrell and Garth Saloner (1985)’s model, and then simulate the market diffusion route of new technology by three random tests in the paper. Furthermore, we study the results of random tests to find out the fundamental conditions for new technology replacing old one. The study indicates that (1) self-reinforcement effect of new technology can be available only when the network size reaches critical mass; (2) the critical mass and the speed reaching critical mass depend on consumer features and enterprise business strategy in the market. The conclusion provides some helpful suggestions on how to commercialize new technology within our technical innovation strategy.