Open standard : role of externalities and impact on the industry structure

Xavier Lecocq, and Benoit Demil

1/01/2005
(Original Publish Date: 2002)

Conceding a part of property rights appears counter-intuitive in regards to the Porterian and RBV frameworks. However industrial economics literature and recent examples suggest that this strategy is fruitful to develop network externalities and consequently to impose a standard in network industries. Drawing on the empirical data collected from 193 firms in the U.S. Role playing Game industry, we shed light on the role of the sponsor and on the impact of an open property rights strategy on the industry structure.