Strategic Maneuvering of Technological Factors and Emergence of De Facto Standards
Abstract
The emergence of a de facto standard in a product class depends on technological, competitive, and market factors. The question is whether or not a firm can strategically manipulate various factors to help determine the winner. To address this question, three factors, technological superiority, openness, and compatibility, are examined with regard to their influence on the emergence of de facto standards. Hypotheses are tested with an analysis of 78 historical cases in 39 market categories. Results indicate that in setting de facto standards, technological superiority is uniformly important, suggesting the logic of technological determinism. Moreover, results also suggest that the influence of technological openness may be contingent on the nature of competition. Thus, strategic managers may need to incorporate a contingency perspective into the selection of an appropriate strategy.
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