Self-reinforcing mechanisms and market information

We consider the possibility of switching between two technological standards when there are network externalities and imprecise market information, by modeling the decisions of each firm by a stochastic process. Necessary and sufficient conditions for there to be multiple equilibria in market share, and for permanent lock-in to one of these equilibria not to occur, are presented. In such a case, the market lingers at prevalence of one standard with intermittent transitions to prevalence of the other, the frequency of which is derived by the theory of large deviations.