Exploration and Exploitation in the Presence of Network Externalities

This paper examines the conditions under which exploration of a new, incompatible technology is conducive to firm growth in the presence of network externalities. In particular, this study is motivated by the divergent evolutions of the PC and the workstation markets in response to a new technology:... reduced instruction set computing (RISC). In the PC market, Intel has developed new microprocessors by maintaining compatibility with the established architecture, whereas it was radically replaced by RISC in the workstation market. History indicates that unlike the PC market, the workstation market consisted of a large number of power users, who are less sensitive to compatibility than ordinary users. Our numerical analysis indicates that the exploration of a new, incompatible technology is more likely to increase the chance of firm growth when there are a substantial number of power users or when a new technology is introduced before an established technology takes off. Ausführliche Beschreibung Beschreibung ausblenden

1. Person:	Lee, Jeho verfasserin
Quelle:	in Management science : journal of the Institute for Operations Research and the Management Sciences Vol. 49, No. 4 (2003), p. 553-570 Weitere Artikel
Format:	Online-Artikel
Sprache:	English
Veröffentlicht:	2003
Beschreibung:	Online-Ressource
Schlagworte:	research-article Network Externalities Exploration and Exploitation Innovation Technology
Online Zugang:	Volltext
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Anmerkung:	Copyright: Copyright 2003 INFORMS