Profit allocation in mobile commerce value chain based on the evolution game theory

With the rapid development of 3G technologies and continuous acceleration of consumers´ convenient oriented, china´s mobile commerce market are promising a bright future. However, as the key problem in the development of mobile commerce, the profit allocation mechanism of mobile commerce value chain is still unclear. In this paper, we study the ratio of profit allocation between mobile network operators and content providers based on the evolution game theory. This study found that the optimal ratio of profit allocation is determined by joint profit, MNO´s costs and CP´s costs. When ratio of profit allocation decided, the effort level is proportional to the contribution coefficient and the ratio of profit allocation. In the condition of individual profit maximum, the effort level is inversely proportional to square of innovation cost coefficient.