network externality

network externality

A situation in which the price somebody is willing to pay to gain access to a network is based solely on the number of other people who are currently using it. Fax machines and Internet e-mail are prime examples. The more people who use the services, the more others are willing to use it. See network effect.
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The ICT infrastructure also generates spillover and network externality effects among firms and various other economic units within and across countries, leading to enhanced economic growth and development.
This resultant positive network externality improves not just the health of an individual ad execution value chain, but also the health of the greater online and mobile advertising ecosystems.
Recommendation D-156 of the International Telecommunications Union (IUT), which deals with network externality premiums, is also in line with the application of these innovative funding mechanisms to international interconnection tariffs, although it does not refer to them explicitly.
Licensing Exclusivity, Transfer Costs, Monopoly Rent, Tacit Knowledge, Intellectual Property, Power Distance, Network Externality
Such cross-group network externality represents an instance of indirect network externalities (Katz & Shapiro, 1985).
Peering benefits come mainly from the network externality.
Perhaps such an explanation did not fit the two-sided network externality mold or violated the admonition against applying lessons from other sectors to the card business.
The more parties use a standardized term over time, the more certainty the term achieves--giving rise to a network externality effect.
The existing domestic network externality effect is likely to be supplemented by a neighbourhood network externality effect as official euroisation spreads eastward.
Namely, in Figure 5, the social marginal cost curve lies above the private marginal cost curve because of the congestion externality and the social marginal benefit curve lies above the private marginal benefit curve because of the network externality.
Robert King [1983, 133] identifies a direct network externality in the market for banknotes when he observes that "an increase in the number of users of a particular note could lower the probability of meeting an individual uninformed about the value of one's note and, hence, the expected cost of trades.
The network externality argument rests on an assumption of consumer rationality that cannot be restricted to consideration of the impact of today's low prices on future market dominance.

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