Advanced Market Share Modelling Based on Markov Chains

Appropriate modelling of market shares enables optimal planning of resources and investments for product providers, manufactures/ vendors and policy measures for regulatory bodies. As a method for analysing the pattern of customer decision-making in moving from one product provider to another and consequently for market share modelling, the Markov chains can be used. Paper presents methods for Markov chain transition probabilities determination and its usage for market share forecasting, indicating what would happen if market forces remain the same, and shows its descriptive features related to Gross Add, Net Add and Churn. In addition, the new concept of the Markov chains based on diffusion growth model principles is introduced and illustrated on the case of broadband access technology diffusion.