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Late Entrant Strategies in Technological Ecologies

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  • Paul Windrum

Abstract

This paper examines the way in which Microsoft, a late entrant in the browser market, was able to exploit linkages between the complementary elements forming a technological ecology in order to overcome the lock-in advantages initially enjoyed by Netscape. The case study forces us to critically appraise three related research questions. First, what strategies can be employed by late market entrants to overcome the lock-in advantages enjoyed by dominant incumbents? Second, are cooperative alliances preferable to the in-house, cross-product optimization of interrelated technologies? Third, is there a tendency for unbundling over the course of the industry life cycle? A coupled Polya Urn model is developed in order to clarify the strategies employed by Microsoft and Netscape in the browser wars. The findings highlight the gains from leveraging installed user bases across interrelated product markets, with cross-product optimization being a key source of strategic advantage for firms competing in technological ecologies.

Suggested Citation

  • Paul Windrum, 2001. "Late Entrant Strategies in Technological Ecologies," International Studies of Management & Organization, Taylor & Francis Journals, vol. 31(1), pages 87-105, March.
    • Handle: RePEc:taf:mimoxx:v:31:y:2001:i:1:p:87-105
    DOI: 10.1080/00208825.2001.11656809
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    Cited by:

    1. Seleshi Sisaye & Jacob G. Birnberg, 2010. "Organizational development and transformational learning approaches in process innovations," Review of Accounting and Finance, Emerald Group Publishing Limited, vol. 9(4), pages 337-362, November.
    2. Krishnamurthy, Sandeep, 2009. "CASE: Mozilla vs. Godzilla — The Launch of the Mozilla Firefox Browser," Journal of Interactive Marketing, Elsevier, vol. 23(3), pages 259-271.
    3. 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.
    4. Hao Zhao, 2003. "R&D Competition Between an Incumbent and an Entrant: An Integrated Model of R&D Investment, Performance Improvement, and Time-to-Market," Review of Marketing Science Working Papers 2-2-1023, Berkeley Electronic Press.
    5. Bayus Barry & Chintagunta Pradeep, 2003. "Competitive Entry and Pricing Responses to Product Innovation," Review of Marketing Science, De Gruyter, vol. 1(1), pages 1-26, August.

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