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Product entry in a fast growing industry: The LAN switch market

In: Innovation, Industrial Dynamics and Structural Transformation

Author

Listed:
  • Roberto Fontana

    (University of Pavia
    CESPRI - Bocconi University)

  • Lionel Nesta

    (Observatoire Français des Conjonctures Economiques)

Abstract

We provide empirical evidence on market positioning by firms, in terms of market niche, distance from technological frontier and dispersion. We focus on the switch industry, a sub-market of the Local Area Network industry, in the nineties. Market positioning is a function of the type of firms (incumbents versus entrants), market size and contestability as well as firm competencies. We find that incumbents specialize in high-end segments and disperse their product in a larger spectrum of the market. Instead, entrants focus on specific market niches. Market size, market contestability and firm competencies are also important determinants of product location.

Suggested Citation

  • Roberto Fontana & Lionel Nesta, 2007. "Product entry in a fast growing industry: The LAN switch market," Springer Books, in: Uwe Cantner & Franco Malerba (ed.), Innovation, Industrial Dynamics and Structural Transformation, pages 87-106, Springer.
    • Handle: RePEc:spr:sprchp:978-3-540-49465-2_6
    DOI: 10.1007/978-3-540-49465-2_6
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    References listed on IDEAS

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    1. repec:hal:spmain:info:hdl:2441/6127 is not listed on IDEAS
    2. repec:hal:wpspec:info:hdl:2441/6121 is not listed on IDEAS
    3. Sean T. Hsu & Susan K. Cohen, 2022. "Overcoming the Incumbent Dilemma: The Dual Roles of Multimarket Contact During Disruption," Journal of Management Studies, Wiley Blackwell, vol. 59(2), pages 319-348, March.
    4. Roberto Fontana & Lionel Nesta, 2007. "Entry, Innovation and Exit from LAN Switch Industry," Working Papers hal-00973045, HAL.
    5. R. Fontana & L. Zirulia, 2015. "then came Cisco, and the rest is history : a history friendly model of the Local Area Networking industry," Working Papers wp993, Dipartimento Scienze Economiche, Universita' di Bologna.
    6. repec:spo:wpmain:info:hdl:2441/6127 is not listed on IDEAS
    7. Roberto Fontana & Lionel Nesta, 2009. "Product Innovation and Survival in a High-Tech Industry," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 34(4), pages 287-306, June.
    8. repec:spo:wpecon:info:hdl:2441/6121 is not listed on IDEAS
    9. repec:hal:wpspec:info:hdl:2441/6127 is not listed on IDEAS
    10. Fontana, Roberto & Zirulia, Lorenzo, 2023. "How far from the tree does the (good) apple fall? Spinout creation and the survival of high-tech firms," Journal of Economic Behavior & Organization, Elsevier, vol. 213(C), pages 26-49.
    11. Roberto Fontana & Lorenzo Zirulia, 2015. "“…then came Cisco, and the rest is history”: a ‘history friendly’ model of the Local Area Networking industry," Journal of Evolutionary Economics, Springer, vol. 25(5), pages 875-899, November.
    12. Wang, Pengfei, 2019. "Price space and product demography: Evidence from the workstation industry, 1980–1996," Research Policy, Elsevier, vol. 48(9), pages 1-1.
    13. Roberto Fontana & Alessandro Nuvolari & Bart Verspagen, 2009. "Mapping technological trajectories as patent citation networks. An application to data communication standards," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 18(4), pages 311-336.
    14. repec:hal:spmain:info:hdl:2441/6121 is not listed on IDEAS
    15. repec:spo:wpmain:info:hdl:2441/6121 is not listed on IDEAS
    16. Roberto Fontana & Lionel Nesta, 2007. "Entry, Innovation and Exit. Evidence from the LAN switch Industry," Documents de Travail de l'OFCE 2007-02, Observatoire Francais des Conjonctures Economiques (OFCE).
    17. repec:spo:wpecon:info:hdl:2441/6127 is not listed on IDEAS

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    More about this item

    Keywords

    Product introduction; Entry; LAN industry;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L63 - Industrial Organization - - Industry Studies: Manufacturing - - - Microelectronics; Computers; Communications Equipment

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