Local and Cultural Factors in Mobile Data Communications: The Case of the SMS in China and Hong Kong SAR

Hong Kong University of Science and Technology (HKUST), Xu Yan (xuyan@ust.hk)

Introduction

! Studies from the social psychology perspective have revealed that local and cultural factors are key determinants for technology acceptance

! The contrast between the booming of the SMS in China and the sluggish response to the SMS in Hong Kong is a new evidence

Theory of Reasoned Action (TRA)

Beliefs and Evaluations Attitude towardbehavior(A)

Normative Beliefs andMotivation to comply Subjective Norm (SN)

BehavioralIntention

(BI)

ActualBehavior

! A person’s performance of a specified behavior is determined by his behavior intention (BI).

! BI is a measure of the strength of one’s intention to perform a specified behavior.

Theory of Reasoned Action (TRA)

! BI is jointly determined by the person's attitude (A) and subjective norm (SN)

! A is determined by his or her salient beliefs about consequences of performing the behavior and the evaluation of these consequences.

! SN refers to the person’s perception that most people who are important to him think he should or should not perform the behavior in question. It may also refers to social pressure.

Technology Acceptance Model (TAM)

Attitude (A)

PerceivedUsefulness

(PU)

ExternalVariables

PerceivedEase of Use

(PEOU)

BehavioralIntention to

(BI)

ActualSystem

Acceptance

ExternalVariables +

+

+ +

+

! TAM, on the basis of TRA, is specifically used for modeling user acceptance of information technology/systems.

! It posits that two particular variables, perceived usefulness and perceived ease of use, are of primary relevance for IT acceptance behaviours

Technology Acceptance Model (TAM)

! Perceived usefulness (PU) is defined as the prospective user’s subjective probability that using a specific application system will increase his specified performance

! Perceived ease of use refers to which a person believes that using a particular system would be free of effort

Research Framework Model

P e r c e iv e dU s e f u ln e s s

( P U )

E x t e r n a lV a r ia b le s

P e r c e iv e dE a s e o f U s e

( P E O U )

A c t u a lS y s te m

A c c e p t a n c eo f S M S

S u b je c t iv eN o r m ( S N )

E x t e r n a lV a r ia b le s

E x t e r n a lV a r ia b le s

+

+

+

Growth of Mobile Users in China

(Source: The Ministry of Information Industry)

-

50,000

100,000

150,000

200,000

250,000

300,000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

DigitalAnalog

Growth of Mobile Users in Hong Kong

103 % mobile penetration by 2003

0

1

2

3

4

5

6

7

1995 1996 1997 1998 1999 2000 2001 2002.8

M o b ile u s e r s , Hong Kong, China (million)

A nalogue

Dig ital, 800/900 M Hz

"A c tiv ated"prepaid

us ersPCS 1.7/ 1.8 GHz

2.5G us ersOther prepaid

Source: OFTA

Source: ITU, OFTA

Subscribers are not Necessarily Users

431

366

299

213

141115

231189 176

86 72 63

0

50

100

150

2 00

2 50

3 00

3 50

4 00

4 50

5 00

19 96 199 7 19 9 8 19 9 9 2 0 0 0 2 0 01 2 00 2

AR

PU

(Yua

n)

Blended ARPU Contract User Prepaid User

439

393366

296

234207

322 324 334

122103 99

0

5 0

10 0

15 0

20 0

25 0

30 0

35 0

40 0

45 0

50 0

199 6 19 97 19 9 8 199 9 2 00 0 2 0 01 2 00 2

MO

U (m

inut

es)

Blended MOU Contract User Prepaid User

Explosive Growth of the SMS in China

126.7 313.4 1,299.70 4,775.70

12,600.00

27,800.00

40,690.00

100

5100

10100

15100

20100

25100

30100

35100

40100

45100

Mill

ion

Mes

sage

s

1H 2000 2H 2000 1H 2001 2H 2001 1H 2002 2H2002 1H2003

Sluggish Response to the SMS in Hong Kong

40

50

60

70

80

90

100

Oct-02 Nov-02 Dec-02 Jan-03 Feb-03 Mar-03 Apr-03 May-03 Jun-03 Jul-03 Aug-03 Sep-03

Mean Comparison by T-test and One-way ANOVA

Yes.000152.46812002.3951(1.147)4.175(1.0724)UA3

Yes.000205.17942002.1064(1.041)4.030(1.0886)UA2

Yes.00074.265952002.5684(.9963)3.715(1.0999)UA1

Yes.0077.355952002.6000(.8921)2.950(1.097)SN2

Yes.000160.58932002.5054(.8923)4.040(.9967)SN1

Yes.000264.651002002.2500(.9468)4.1150(.9307)PEOU2

Yes.00036.382842003.4881(.9999)4.1700(.8089)PEOU1

Yes.00037.102962002.7604(.8914)3.4450(.9117)PU2

Yes.00020.976822003.5610(.8620)4.0950(.9000)PU1

HKBeijingHong KongBeijing

Significantly different?P-valueF

NMean (SD)

Frequency of Using the SMS

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Daily Once a Week Once a Month Others

BeijingHong Kong

Information Infrastructure Level

! A substitute to e-mail wireline Internet! 206.6 million mobile subscribers but only 49.7 million

Internet subscribers by 2002! Not all mobile services are more advanced than the fixed!

Demand to Mobile Data Services in China

41%

16%12% 10% 8% 6% 7%

0%5%

10%15%20%25%30%35%40%45%

E-mail StockTransaction

News Game Shopping Banking Others

Preference of Using the SMS to Send Message

0%

5%

10%

15%

20%

25%

30%

35%

40%

Strongly Disaggree Disagree Neutral Agree Strongly Agree

BeijingHong Kong

Culture

! Users in China are reluctant to talk to machine

! Users in Hong Kong has been used to leaving voice mail

! The competitiveness of mobile voice service makes the SMS a relatively expensive service in HK

Price Perception of SMS

0%

10%

20%

30%

40%

50%

60%

70%

Cheap Reasonable Expensive

BeijingHong Kong

Market Competition

Political Factor

! The SMS is Now a New and Informal Literature! Bypass the Government’s censorship! Social pressure to access and share with the others

The SMS Content

0%

5%

10%15%

20%

25%

30%

35%40%

45%

50%

Greetings Jokes Advertisement Others

BeijingHong Kong

Business Model: Forming a Positive Feedback

Payment

ContentContent

Input Methods of the Chinese

! Pin Yin is simple and popular in China! Cheong-chi is a complicated method of inputting

Chinese in Hong Kong

Respondence to "SMS is easy to use"

0%

10%

20%

30%

40%

50%

StronglyDisagree

Disagree Neutral Agree Strongly Agree

BeijingHong Kong

The SMS Acceptance Model

PerceivedUsefulness

(PU)Market Competition: AlternativeSubstitution to Highly Priced Voice Service

PerceivedEase of Use

(PEOU)

ActualSystem

Acceptanceof SMS

SubjectiveNorm(SN)

Business Model: Enhance Information Richness andBenefit from Network Externality

Culture:Alternative Substitution to Voice Message

+

+

+Information Infrastructure Level:Alternative Substitution of Wireline Internet

Language: Input Method

Political Censorship:Access and Share Information that are notAvailable in the Public Media

Conclusion

! Good technology or bad technology? That is not a problem.

! User will accept a new technology only when they perceive it as a useful technology

! There are many local and culture determinants that lead to the perceived usefulness

! Perceived ease of use should be paid with attention by vendors and operators

! Social pressure is one of the key factor to achieve critical mass

THANK YOU!