Extending private‐collective innovation: a case study

Abstract

The private-collective innovation model proposes incentives for individuals and firms to privately invest resources to create public goods innovations. Such innovations are characterized by non-rivalry and non-exclusivity in consumption. Examples include open source software, user-generated media products, drug formulas, and sport equipment designs. There is still limited empirical research on private-collective innovation. We present a case study to 1) provide empirical evidence of a case of private-collective innovation, showing specific benefits, and 2) to extend the private-collective innovation model by analyzing the hidden costs for the company involved. We examine the development of the Nokia Internet Tablet, that builds on both proprietary and open source software development, and that involves both Nokia developers and volunteers who are not employed by the company. Seven benefits for Nokia are identified, as are five hidden costs: difficulty to differentiate, guarding business secrets, reducing community entry barriers, giving up control, and organizational inertia. We examine actions taken by the management to mitigate these costs throughout the development period. Extending Private-Collective Innovation:A case studyThe private-collective innovation model proposes incentives for individuals and firms to privately invest resources to create public goods innovations. Such innovations are characterized by non-rivalry and non-exclusivity in consumption. Examples include open source software, user-generated media products, drug formulas, and sport equipment designs. There is still limited empirical research on private-collective innovation. We present a case study to 1) provide empirical evidence of a case of private-collective innovation, showing specific benefits, and 2) to extend the private-collective innovation model by analyzing the hidden costs for the company involved. We examine the development of the Nokia Internet Tablet, that builds on both proprietary and open source software development, and that involves both Nokia developers and volunteers who are not employed by the company. Seven benefits for Nokia are identified, as are five hidden costs: difficulty to differentiate, guarding business secrets, reducing community entry barriers, giving up control, and organizational inertia. We examine actions taken by the management to mitigate these costs throughout the development period.

Open innovation using open source tools: a case study at Sony Mobile

“…People in the community may move around geographically, socially and professionally but can still be part of the community and continue to contribute. I3, who took part in the initiation of many projects, recently left Sony Mobile but is still involved in development and reviewing code for his former colleagues which is in line with the findings of previous studies (Morgan et al 2011;Stuermer et al 2009). Otherwise, the knowledge tied to I3 would have risked being lost for Sony Mobile.…”

“…However, the focus is mostly limited to management and strategic aspects, e.g., (Dahlander and Magnusson 2008;West and Wood 2013;Stuermer et al 2009), with some exception of inner sourcing (Morgan et al 2011;Stol et al 2014). Little is still known about what triggers software organizations to adopt OSS from an OI perspective and how this affects SE practices (Munir et al 2016).…”

“…Among these challenges, Daniel et al (2011) suggested that the conflict between organizational and OSS standards reduces developers' organizational commitment and it is strongly dependent on the degree to which developers associate themselves with organizations or OSS communities. Investing in OSS may also be costly and create differentiation and property right protection challenges, as indicated by Stuermer et al (2009) who studied the Nokia Internet Tablet, which was based on a hybrid of OSS and proprietary software development. West and Wood (2008) examined the complex ecosystem surrounding Symbian Ltd. and identified three inherent difficulties for organizations leading an OI ecosystem: 1) prioritizing the conflicting needs of heterogeneous ecosystem participants, 2) knowing the ecosystem requirements for a product that has yet to be created, and 3) balancing the interests of those participants against those of the ecosystem leader.…”

“…Also, some benefits may first be fully utilized after contributing back certain parts to the OSS community (Ven and Mannaert 2008). For example, by correcting bugs, actively participating in discussions and contributing new features, a software organization might reduce maintenance cost compared to proprietary software development (Stuermer et al 2009). Hence, in order for a firm to gain the expected benefits of products, OI process innovations may be a required step on the way forward (Lakhani and von Hippel 2003;Wnuk et al 2012;Rolandsson et al 2011).…”

“…However, valuable insights were found during the interviews regarding what Sony Mobile has gained from the Jenkins and Gerrit community involvement. During the analysis, the following innovation outcomes have been identified: The most distinct innovation outcome is the notion of obtaining free features from the community, which have different facets (Dahlander and Magnusson 2008;Stuermer et al 2009). For projects maintained by Sony Mobile, such as the Gerrit-trigger plug-in, a noticeable amount of external commits can be accounted for.…”