Module Business Entry, Exit And Upgrade Investment Decision-making Research

Fast development of the information industry is important strength to push economic development and social progress. Information industry is full of module features, various phenomena of this industry are results of enterprises microscopic behavior. During the information industry developing process, how can the information enterprises make a proper project investment is more significant to enterprises development. As information industry has features of technique complexity, huge amount of investment, uncertainty of results, traditional innovative investment model can no longer effectively solve the problems in investment.Considering importance of information industry in national economic development and insufficiency of traditional innovative investment, this article discusses problems in information enterprises investment in method of module innovation. Taking into account of factors as module complexity, technical potential, customers’ preferences etc, in method of real option, this article establishes three kinds of investments:first time module investment of complete monopolistic enterprises, module investment new of new enterprises under market competition, innovative module investment of current existing enterprises.The research results indicate that,(1) Modular investment has a fixed minimum optimal number of tests, its corresponding critical value of investment is the module investment on the true meaning of "critical value of investment".(2) When the market demand level is lower than the" critical value of investment", the real factor to influence the minimum optimal number of trials is the market the level of demand for expected growth rate and volatility, other factors does not influence.(3) New enterprises need to avoid competition with current existing enterprises when newly entering market, they need to take strategy of high-end entering or low-end entering.(4) In the low-end entry strategy, the optimal number of tests increases and then reduces along when the module technical potential increases;while in the high-end entry strategy, optimal test number increases gradually.(5) Market demand Level and competitors’system performance differences will affect current existing enterprises’optimal module investment strategy, at a given market demand level, enterprises chooses to exit, maintain or upgrade according to its system initial performance level.(6) Optional optimal strategies for a low level performed enterprises include exiting, maintaining or upgrading; Optional optimal strategies for a middle level performed enterprises include exiting, middle-end waiting or upgrading; Optional optimal strategies for a lead level performed enterprises include exiting, high-end waiting or upgrading.This study contributes to our understanding of the phenomena and the evolution rule in modular information industry.