Paper
Apply Real Options for Decision Making of MNO’s Investment Expansion in 4G WiMAX Mobile Network
- Authors:
- Santi Pattanavichai; Wichian Premchaiswadi
- Abstract
- This paper focuses on real option theory and its applications in 4G WiMAX mobile network. The objective of this paper are (1) to introduce real option theory and to discuss its applicability as a decision support tools, (2) to apply real option approach based on the proposed pricing model to the selected case to demonstrate the power of option pricing models. In this study, we intend to include the main investment costs of MNO in 4G WiMAX mobile network, which comprise of the costs of Base Transceiver Station (BTS), and Access Service Network Gateway (ASN-GW), in Network Access Providers (NAPs) domain for the cost analysis. After applying real options based on the proposed pricing model and the option’s parameters, the results show that the static Net Present Value (with option to expand) confirms the results obtained from the financial option (no option).
- Keywords
- Worldwide Interoperability for Microwave Access (WiMAX); Mobile Network Operator (MNO); Mobile Virtual Network Operator (MVNO); Pricing Model; Real Options Analysis; Sensitivity Analysis
- StartPage
- 13
- EndPage
- 21
- Doi