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Winning the standards race: : Building installed base and the availability of complementary goods

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  • Schilling, Melissa

Abstract

In markets that have forces encouraging the adoption of a dominant design, the size of a technology's installed base and the availability of complementary goods may be the most important factors determining its success or failure. This article examines the path dependent nature of technology trajectories, and the self-reinforcing effects of installed base and complementary goods. The article posits that firms can greatly influence their installed base and the availability of complementary goods through their distribution, alliance and marketing strategies. Both theory and examples are used to demonstrate how firms can manage the dynamics of technology selection in their favor.

Suggested Citation

  • Schilling, Melissa, 1999. "Winning the standards race: : Building installed base and the availability of complementary goods," European Management Journal, Elsevier, vol. 17(3), pages 265-274, June.
    • Handle: RePEc:eee:eurman:v:17:y:1999:i:3:p:265-274
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    Cited by:

    1. van de Kaa, Geerten & de Vries, Henk J., 2015. "Factors for winning format battles: A comparative case study," Technological Forecasting and Social Change, Elsevier, vol. 91(C), pages 222-235.
    2. Kevin J. Boudreau, 2012. "Let a Thousand Flowers Bloom? An Early Look at Large Numbers of Software App Developers and Patterns of Innovation," Organization Science, INFORMS, vol. 23(5), pages 1409-1427, October.
    3. Sillanpää, Antti & Laamanen, Tomi, 2009. "Positive and negative feedback effects in competition for dominance of network business systems," Research Policy, Elsevier, vol. 38(5), pages 871-884, June.
    4. Stremersch, S. & Tellis, G.J. & Franses, Ph.H.B.F. & Binken, J.L.G., 2007. "Indirect Network Effects in New Product Growth," ERIM Report Series Research in Management ERS-2007-019-MKT, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    5. Cenamor, Javier, 2021. "Complementor competitive advantage: A framework for strategic decisions," Journal of Business Research, Elsevier, vol. 122(C), pages 335-343.
    6. Cavalheiro, Gabriel Marcuzzo do Canto & Joia, Luiz Antonio & Van Veenstra, Anne Fleur, 2016. "Examining the trajectory of a standard for patent classification: An institutional account of a technical cooperation between EPO and USPTO," Technology in Society, Elsevier, vol. 46(C), pages 10-17.
    7. van de Kaa, Geerten & Janssen, Marijn & Rezaei, Jafar, 2018. "Standards battles for business-to-government data exchange: Identifying success factors for standard dominance using the Best Worst Method," Technological Forecasting and Social Change, Elsevier, vol. 137(C), pages 182-189.
    8. de Vries, H.J. & de Ruijter, J.P.M. & Argam, N., 2009. "Dominant Design or Multiple Designs: The Flash Memory Card Case," ERIM Report Series Research in Management ERS-2009-032-LIS, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    9. Fan, Terence & Schwab, Andreas & Geng, Xuesong, 2021. "Habitual entrepreneurship in digital platform ecosystems: A time-contingent model of learning from prior software project experiences," Journal of Business Venturing, Elsevier, vol. 36(5).
    10. Anna Cabigiosu, 2022. "Sustainable development and incumbents' open innovation strategies for a greener competence‐destroying technology: The case of electric vehicles," Business Strategy and the Environment, Wiley Blackwell, vol. 31(5), pages 2315-2336, July.
    11. Klaus Heine & Wolfgang Kerber, 2002. "European Corporate Laws, Regulatory Competition and Path Dependence," European Journal of Law and Economics, Springer, vol. 13(1), pages 47-71, January.
    12. Roumani, Yaman & Nwankpa, Joseph K. & Roumani, Yazan F., 2016. "Examining the relationship between firm’s financial records and security vulnerabilities," International Journal of Information Management, Elsevier, vol. 36(6), pages 987-994.
    13. Leonhard Dobusch & Elke Schüßler, 2013. "Theorizing path dependence: a review of positive feedback mechanisms in technology markets, regional clusters, and organizations," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 22(3), pages 617-647, June.
    14. Johansson, Magnus & Kärreman, Matts & Foukaki, Amalia, 2019. "Research and development resources, coopetitive performance and cooperation: The case of standardization in 3GPP, 2004–2013," Technovation, Elsevier, vol. 88(C).
    15. Fabrizio, Kira R. & Hawn, Olga, 2013. "Enabling diffusion: How complementary inputs moderate the response to environmental policy," Research Policy, Elsevier, vol. 42(5), pages 1099-1111.
    16. Rietveld, G.J. & Eggers, J.P., 2016. "Demand Heterogeneity and the Adoption of Platform Complements," ERIM Report Series Research in Management ERS-2016-003-STR, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    17. Su-Young Kwak & Woo-Sung Cho & Gil-Am Seok & Seung-Gyun Yoo, 2020. "Intention to Use Sustainable Green Logistics Platforms," Sustainability, MDPI, vol. 12(8), pages 1-17, April.
    18. Nicholas Burton & Peter Galvin, 2020. "Component complementarity and transaction costs: the evolution of product design," Review of Managerial Science, Springer, vol. 14(4), pages 845-867, August.
    19. Steiner, Michael & Wiegand, Nico & Eggert, Andreas & Backhaus, Klaus, 2016. "Platform adoption in system markets: The roles of preference heterogeneity and consumer expectations," International Journal of Research in Marketing, Elsevier, vol. 33(2), pages 276-296.
    20. Fuentelsaz, Lucio & Gómez, Jaime & Palomas, Sergio, 2012. "Production technologies and financial performance: The effect of uneven diffusion among competitors," Research Policy, Elsevier, vol. 41(2), pages 401-413.
    21. Bisceglia, Michele & Padilla, Jorge & Piccolo, Salvatore & Shekhar, Shiva, 2022. "Vertical integration, innovation and foreclosure with competing ecosystems," Information Economics and Policy, Elsevier, vol. 60(C).
    22. Puay Khoon Toh & Shiva Agarwal, 2023. "The option value in complements within platform‐based ecosystems," Strategic Management Journal, Wiley Blackwell, vol. 44(2), pages 576-609, February.
    23. Kang, Jin-Su & Downing, Stephen, 2015. "Keystone effect on entry into two-sided markets: An analysis of the market entry of WiMAX," Technological Forecasting and Social Change, Elsevier, vol. 94(C), pages 170-186.

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