Standard wars, tied standards, and network externality induced path dependence in the ICT sector

Heinrich, Torsten

doi:10.1016/j.techfore.2013.04.015

Cited by 32 publications

(24 citation statements)

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“…More recent approaches emphasize that there may be a general mechanism that breaks the symmetry of the underlying growth and contraction process. Increasing returns (network externalities, for instance) lead to advantages for established competitors with large user bases for their products -which is arguably particularly important in modern ICTs (Arthur (1996), Bottazzi and Secchi (2006), Heinrich (2013Heinrich ( , 2014, Buendía (2013)). An alternative approach is that in the presence of different (substitutable) input factors, firm types with different factor utilization (productivity) profiles will obtain different sustainable market shares (i.e., in the steady state) (Schwardt and Schwesinger (2013)).…”

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confidence: 99%

Diversity of firm sizes, complexity, and industry structure in the Chinese economy

Heinrich

Dai

2016

Structural Change and Economic Dynamics

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Among the phenomena in economics that are not yet well-understood is the fat-tailed (power-law) distribution of firm sizes in the world's economies. Different mechanisms suggested in the literature to explain this distribution of firm sizes are discussed in the present paper. The paper uses the China Industrial Enterprises Database to study the distribution (firm size in terms of the number of employees, capital, and gross profit) for the provinces of China for the years 1998-2008. We estimate the power-law distribution and confirm its plausibility using the KS test and the log-likelihood ratio vs. lognormal and exponential distributions. The analysis on regional levels allows an assessment of regional effects on differences in the distribution; we discuss possible explanations for the observed patterns in the light of the recent regional economic development in the PRC.

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confidence: 99%

Diversity of firm sizes, complexity, and industry structure in the Chinese economy

Heinrich

Dai

2016

Structural Change and Economic Dynamics

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“…The idea of tied standards was initially proposed by Choi (2004) and analyzed in a game theory framework. Later, an evolutionary replicator model was put forward (Heinrich 2014); this model will be used and extended for the analysis in the present article.…”

Section: Literature Reviewmentioning

confidence: 99%

“…The present study will be based on a replicator model that largely follows the model proposed in Heinrich (2014). The numerical study below requires assuming specific parameter sets.…”

Section: Replicator Dynamic Model With Implicit Network Structurementioning

confidence: 99%

Network Externalities and Compatibility Among Standards: A Replicator Dynamics and Simulation Analysis

Heinrich

2017

Comput Econ

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The importance of network externalities for the development of technology and industry structure has been recognized in evolutionary economic for a long time. However, network externalities are no isolated phenomena. They are based on competing standards in a comprehensive network of technology lines that are based on one another and remain to various degrees interoperable or compatible. As some evidence from the ICT sector inparticular shows, compatibility and tying or bundling of standards may be employed as strategic tools. The present paper investigates the economic role of tied standards for the dynamics of competition between standards. A replicator model operating on an aggregated level is complemented by an agentbased simulation with explicit representation of the network structure among users. A variety of effects are studied, including the role of initial usage share, manipulation of compatibility, expansion of vendors into other segments, as well as the network structure and central or peripheral positioning of agents. The agent-based model contrasts a complete network and a regular ring network with asymmetric network structures derived from Barabàsi and Albert's preferential attachment mechanism and triadic closure.

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“…Highly visible competition between standards and standardization activities initiated the debate on "Standards wars" (Shapiro & Varian 1999;Heinrich 2014; van de Kaa & de Vries 2015). These controversies have been studied in the case of video recorders (Cusumano, Mylonadis & Rosenbloom 1992), with later issues between formats of document files (Blind 2011), digital video disks (Christ & Slowak 2009;Daidj, Grazia & Hammoudi 2010), and the communications technology competition, for example, in home networking (van de Kaa 2009).…”

Section: Standardization In Value Systemsmentioning

confidence: 99%

“…Leaders actively utilize internal and external collaboration, which influence the network effects and define the scope of interoperability and, furthermore, exploit the flexibility in standardized systems and technologies (van den Ende et al 2012;Daidj, Grazia & Hammoudi 2010). Network effects in one sector may be able to drive the system dynamics on closely interrelated sectors (Heinrich 2014). Therefore, the value systems utilizing the same technologies and standards often align, or "self-organize", their behaviors.…”

Section: Standardization In Value Systemsmentioning

confidence: 99%

Evolution toward an open value system for smart mobility services

Casey

Ali-Vehmas

Valovirta

2017

Competition and Regulation in Network Industries

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Service adoption strategies of push over cellular The original ideas for the framework came from both Ali-Vehmas and Luukkainen. Ali-Vehmas provided the initial case data while Luukkainen provided primarily theoretical contributions. Both Luukkainen and Ali-Vehmas further developed the journal article based on the initial joint conference paper in the International Conference of Mobile Business (ICMB'05) "Service diffusion strategies for push to talk over cellular", pp 427-433, 2005 presented by Ali-Vehmas. Publication II Evolution of wireless access provisioning: A systems thinking approach The original idea for the developed framework came from Ali-Vehmas. Casey conducted the interviews. Ali-Vehmas and Casey together further developed the framework and did the analysis. Ali-Vehmas and Casey together also wrote and edited the article. Publication III Complex network perspective to collaboration in the ICT standardization The original idea for the research came from Ali-Vehmas. Ali-Vehmas is the sole contributor of this article. Nokia Corporation provided the raw data sets. Publication IV Value system evolution toward a cognitive radio era: Implications of underlying market dynamics The article continued the work of Publication II. Casey developed the simulation model to which Ali-Vehmas provided comments. Casey and Ali-Vehmas together did the analysis. Casey wrote the first version of the article. Ali-Vehmas added text, further developed some of the conceptual ideas, and edited the article. Casey presented the paper in the IEEE 2012 DySPAN conference. Publication V Examining value system transitions: The case of smart mobility services The article is an application of the methodologies of Publications II and III in a qualitative analysis. Ali-Vehmas and Casey contributed to the case study. Ali-Vehmas further developed the detailed analysis. Ali-Vehmas and Casey wrote and edited the article. Ali-Vehmas presented the paper in the HICSS 48 conference. Research approach Concepts and methods developed for studying complex adaptive systems provide a compelling framework for the research on value systems with complexity. This thesis applies earlier conceptual models of complex systems to empirical ICT-driven value systems to develop a model for complex value systems, which can be used to examine behaviors of such systems. Empirical value systems

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Standard wars, tied standards, and network externality induced path dependence in the ICT sector

Cited by 32 publications

References 24 publications

Diversity of firm sizes, complexity, and industry structure in the Chinese economy

Diversity of firm sizes, complexity, and industry structure in the Chinese economy

Network Externalities and Compatibility Among Standards: A Replicator Dynamics and Simulation Analysis

Evolution toward an open value system for smart mobility services

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