A strategic method to establish sustainable platform businesses for next-generation home-network environments
Author(s)
Ishii, Makoto, M.B.A. Massachusetts Institute of Technology
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Sloan School of Management.
Advisor
Michael A. Cusumano.
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The situation of the consumer electronics industry has become severe due to the rapid growth of digital hardware technology, and sophisticated open source technology. Every product of this industry has become commoditized very rapidly due to the emergence of those technologies, and many firms have been suffering from very thin profitability. Under such severe circumstances, the firms in the high-tech industry that enjoy overwhelming market share, profitability, and sustainability are the firms doing "Platform business," such as Intel and Microsoft, rather than those doing low margin "product selling business." Looking at the great sustainability of those firms, many high-tech firms have aimed to be successful Platform leaders, but to do so is not easy. In this paper, I define key success factors for consumer electronics firms to be able to be profitable and sustainable Platform Leaders, especially focusing on the "home-network platform business" where many high-tech firms have tried to be a dominant design holder. (cont.) I explore how to let a company's own technology and business model become a dominant design in the home-network business, how to establish a successful Platform business with the dominant design, and how to maintain sustainability and high profitability of the Platform business as a Platform leader. Concretely, based on Platform Leadership levers defined by Cusumano and Gawer, I define the Enhanced Platform Leader Model, EPLM, as newly redefined key success factors for being a successful Platform leader, by analyzing past successful and unsuccessful Platform business cases of new home-network businesses. In addition, through proposing an appropriate Platform architecture and other key elements for being a sustainable Platform leader, I propose a new business model for a high potential next-generation home-network business that takes advantage of "intuitive operation" technology, and I also propose appropriate strategies to make the business model successful, using EPLM. The views expressed in this paper are those of the authors and do not reflect those of Sony Corporation.
Description
Thesis (M.B.A.)--Massachusetts Institute of Technology, Sloan School of Management, 2006. Includes bibliographical references (leaves 147-152).
Date issued
2006Department
Sloan School of ManagementPublisher
Massachusetts Institute of Technology
Keywords
Sloan School of Management.