Insurgent strategies for creating inimitability within mature digital ecosystems

Abstract

Rich software application functionality once constrained to the desktop is now available via the World Wide Web (WWW) with the introduction of emergent Web2.0 technologies. Leveraging the Softwareas- a-service (SaaS) model, companies can build Web-native, Operating System (OS) independent, applications usable by customers over the internet in addition to those installed natively on their computer. Effectively this enables software development companies to redirect application work cycles away from OS-specific development and, among other things, into infrastructures which encourage participation by third-party WWW developers. With these emergent technologies, and while embracing what is commonly referred to as the network-centric innovation model, companies are hoping to leverage enormous value and strategic significance by creating and protecting proprietary platforms while at the same time encouraging third-party open source development. In effect, through outward-facing Application Program Interfaces (APIs), these new models have led to the emergence and evolution of complex ecosystems within the WWW space; witness OpenSocial, Facebook, salesforce.com, Amazon, Firefox, eBay and others. eBay for one realized early-on that forging relationships with developers can support and advance its business model. Not long afterwards, http://developer.ebay.com was created giving developers access to a myriad of information on all current and expired auctions. This move enabled companies to enter the ecosystem and provide specialized services to customers based on information mined from eBay's API.

(cont.) A few of these companies provide raw analytical data to PowerSellers-those customers doing serious business on eBay. Others use the data to up-sell by listing current eBay auctions on their own websites. The goal of this thesis is to explore what constitutes an appropriate strategy for insurgents intending to enter WWW ecosystems in attempts to usurp competitors within them. This will be accomplished by looking at specific businesses, their strategic options, engineering challenges and general dilemmas while attempting to create inimitability. As well, a framework will be developed for assessing ecosystem players, their influence, understanding the dynamic interactions not only between those entities, but between them and the ecosystem host, as well.