This paper focuses to discuss and analysis the formal application
of game theory which require the identity of independent actors,
their preferences, their knowledge, strategic acts they are
allowed to make. Each independent actor is assumed to be
coherent. This game theory is not limited to case analysis rather
psychology, tag of war, business, economy etc. The focus is to
use the game theory in information technology more specifically
in Artificial Inelegance, Digital Assistant solution. Analysis the
outcomes of game theory to determine the strategy for market
penetration. The study however reveals some challenges such as
affordance, access to information, cost advantage and subsidy or
support or funding that change the total game of the deployment
plan in order not to exacerbate the problem of digital divide.
Decision making, Game theory, Payoff Matrix, ChatBot, AI,
Artificial Intelligence; Game Theory; Nash Equilibrium; Digital
Assistant; Decision Analysis
The basic tool of game theory is the payoff matrix which is a
matrix gives the possible outcome of zero-sum game when
player A has possible moves and player B moves. The analysis
of the matrix in order to determine optimal strategies is the aim
of game theory .
This is needed to make a decision after payoff matrix analysis.
Payoff matrix helps to take the decision by Nash Equilibrium 
 by which organizations can make their best choices as given
preferable action of the competing organizations. The concept of
game theory is to deviate an organization’s decision with respect
to other organization’s choice and the result of the game is Nash
equilibrium in which one or more opponent has their own
strategy. Again, the best possible response to the action of the
other organization initiate the action of each organizations.
IT services can be adapted to a new culture in a variety of ways
ranging from simple build changes to total redesign in the
services. Some need for change becomes obvious with relatively
little analysis. For example, a cursory analysis of a country will
uncover the need to require AI based digital assistance if it uses
a different customer service system, or to indicate product
simplification when the local level of technologies is not high
 . Most such superficial changes can be spotted by looking
at service use patterns, the economy, and other related culture
2. PROBLEM OVERVIEW
In 2018 both company focuses on Digital Assistants Solution
one of the specific area of Artificial Intelligence. This is a hightech solution for recent trends. The core feature of the systems
are designed to deliver an intuitive, automated experience for all
digital channels by engaging customers in natural conversations
using voice or text  . To add a virtual agent to websites,
app, or text messaging application, this system offers customers
a consistent experience in any digital channel . A familiar
voice will answer their request whether it’s typed into a
computer, tapped on a screen or spoken into a device. A model
of digital assistant especially Chatbot is provided in Fig 1
Two company LeadSoft Bangladesh Limited and M Cube
Corporation are two Bangladeshi native IT companies working
in contemporary system solutions. LeadSoft is a leading
Software Development Company, offering custom software
development, software products, offshore software development,
professional outsourcing and software consultancy. M Cube
Corporation has a wide variety of products, ranging from
backbone infrastructure to peripheral products, including
middleware which are the focus areas of Telecommunication &
Telecom Software Solution providers.
For this Digital Assistant, M Cube Corporation has developed its
own platform and want to serve its customer through this. The
cost of research and development is huge for the platform
development and already exist in the market. Whereas LeadSoft
as a partner of Microsoft Corporation, one of the leaders in IT
sector an American multinational technology company is using
their platform to develop the solution.
In recent years a new breed of Bangladeshi IT marketers is
posing an increasingly credible challenge to go global, following
in the footsteps of Japanese and European startup IT to become
formidable global competitors. Hi-tech IT solutions among the
growing list of international brands making an impact. In this
paper, hi-tech defines as Artificial Intelligence, Block Chain,
Internet of Things, Business Intelligence and Cloud Computing
but not the contemporary software solution like MIS, ERP and
IT support services.
Bangladesh governments subsidize high-technology industries
(largely focuses on IT) which is expected to create welfares that
spillover to other export industries and with a vision to parenting
the infant industry. That is, governments believe that high-tech
industry produces a positive externality. A strategic advantage to
export organizations that are competing with rivals in
international markets is subsidies. Subsidies availed by the
organizations, bound them to choose between strategic
decisions. Strategic interactions between organizations give a
sight to capture the strategic decision making by using game
theory. Organizations are focusing on actions to exhaust the
maximum possibilities of their returns.
4. PAYOFF MATRIX AND NASH
1.1 Payoff Matrix between Two Firms
In each quadrant, bottom-left amount shows the revenues of M
Cube, and the upper-right amount shows the revenues of
LeadSoft. Here the challenge is each organization necessarily
decide whether to deploy a digital assistant or not. A Nash
equilibrium is such a condition where each organization is
determining its best decision, provided that knowing the actions
of other. Considering this condition of payoffs, there exist two
state of Nash equilibrium. One of the which is in the upper-right
and another one is in bottom-left quadrants. So, it basically
means that if LeadSoft deploy then M Cube Corporation does
not and if M Cube Corporation does deploy LeadSoft does not.
Table 1. Payoff Matrix – Level Playing Field for Both Firm
When both the farm are to Deploy then both are going to lose
BDT 2,000,000/- . If any of them decided not to deploy the
system, then the deploying organization will make a revenue of
21,000,000/- and other will not gain anything. If both the farm
decided not to deploy, then both will gain no revenue.
Superlative approach for M Cube If LeadSoft deploys, then M
Cube’s favorable situation is not to deploy. This outcome
demonstrates that having both organizations deploy is not good
for any of them and technically it is not a Nash equilibrium.
Whenever LeadSoft deploys, M Cube would never be
considered in production, since it prefers to leave of the market.
Again, finest approach for LeadSoft laying in the decision
illustrated in the bottom-left quadrant, where considerably
LeadSoft is deploying and M Cube is stay away from
deployment. Here this is also a Nash equilibrium, cause each
organization is considering its best choice given what is the
decision of opponent.
1.2 Effect of a Subsidy/Support/Fund to
As LeadSoft is a local company only which can avail any
Subsidy or Fund or support by the LICT (Leveraging ICT)
Project of Bangladesh Computer Council (BCC) under the
Ministry of Post, Telecom and Information Technology of
Bangladesh Government. Here is to remember that, M Cube
Corporation is registered and headquartered in Singapore.
When the LICT provide a subsidy of BDT 3,000,000/- to
LeadSoft, where LeadSoft’s revenue increased by that much
when it develops the system. There is only one Nash equilibrium
identified in the bottom-left quadrant where LeadSoft deploying
but M Cube is not. The revenue for LeadSoft have amplified
from BDT 0/- to 24,000,000/- while the subsidy cost is only
BDT 3,000,000/-, so there is a net gain of BDT 21,000,000/- in
Table 2. Payoff Matrix – Effect of Subsidy/ Support/Fund
With the subsidy, finest approach for LeadSoft is now to earns
BDT 1,000,000/- by producing instead of losing BDT
2,000,000/-. Best strategy for M Cube will want to drop out of
the market. Once M Cube makes the decision not to deploy,
LeadSoft decision doesn’t change. The bottom-left quadrant is a
Nash equilibrium where individual organization is determining
its best decision along with knowing or exposed actions of the
other. Furthermore, it is the only Nash equilibrium.
1.3 Cost Advantage for M Cube
M Cube Corporation has their own platform for AI with Digital
Assistant which give them a cost advantage of Producing,
integrating and deploying the service. Their system is so
individual and no dependency on other systems. This platform
provides a faster development which M Cube presume and a
technology know how, easily customizable and extendable as
Table 3. Payoff Matrix – - Cost Advantage
Whereas LeadSoft using Microsoft Bot Framework for their
service development. Dependency on Bot Framework may cost
in production, integration and dependency
If M Cube has a cost advantage in the deployment of Digital
Assistant, the payoffs are as shown here. M Cube deploys
revenue BDT 2,000,000 when both the organizations are
deploying. Again, M Cube making revenue BDT 24,000,000/-
when LeadSoft does not deploy. Here there is solely one Nash
equilibrium which is in the upper-right quadrant. On that
specific quadrant M Cube deploys and LeadSoft does not.
1.4 Subsidy for LeadSoft and Cost
Advantages for M Cube
When the Bangladesh provides a subsidy of BDT 3,000,000/- to
LeadSoft, its revenue upsurge by the same volume when it
deploys. There is only Nash equilibrium exist which situated in
the upper-left quadrant, where both organizations deploy the
digital assistance. The revenues for LeadSoft have increased
from 0 to BDT 1,000,000/- , but the subsidy costs BDT
3,000,000/- million, so there is a net loss of BDT 2,000,000/-
million in IT industry welfare
Table 4. Payoff Matrix – Subsidy with Cost Advantage
Again, M Cube Corporation has cost advantages of BDT
2,000,000/- as they has their own platform for AI with Digital
Assistant. M Cube earns revenues of BDT 2,000,000 when both
organizations are producing and revenues of BDT 24,000,000/-
when LeadSoft does not deploy.
The revenue can be maximized if any of the organization do not
lunch their product and other does. Total welfare of the industry
in terms of monitory value will be highest in this situation.
Nevertheless, Lunching by both organization will not regret or
face any potential business loss
5. ANALYSIS AND FINDINGS
* As LeadSoft is availing the LICT fund then of course
they are going to deploy the service.
* M Cube Corporation has a leverage of cost effectiveness
which convert them to go into the market.
* When there are two Nash equilibrium, there must be
some force from outside the model that determines in
which equilibrium this is. An example of one such force
is the first mover advantage, which means that one
organization is able to decide whether or not to deploy
before the other organization . Both the company can
resolve the issues by present their service firstly in front
of customer. This is a healthy competition and both
organization can avoid the tag of war.
For a High-tech industry Nash equilibrium is one of the best way
to take decision. As M Cube and LeadSoft both are in the same
industry, they both need technical support from each other. IT
industry touted as crucial First-mover advantage, although now
there is a growing backlash against it. First-mover advantage can
be instrumental in building market share. In a duopoly Market
Strategic decision are required to capture the market. Time to
market is also very important. To capture the conflict resolution
with strategic decision making of two organizations, by using
game theory, the modeling of strategic interactions (games)
between organizations as they choose actions that will maximize
Heartiest gratitude to Dr. Chowdhury Saima Ferdous, Professor,
Department of International Business, Faculty of Business
Studies, University of Dhaka for her support to us and patronage
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