• Corpus ID: 30094268

Fast-Follower Advantages and Network Externalities in I.T.-Driven Markets

@inproceedings{Ankney2005FastFollowerAA,
  title={Fast-Follower Advantages and Network Externalities in I.T.-Driven Markets},
  author={Kristine R. Ankney and Gezinus J. Hidding},
  year={2005}
}

• Kristine R. Ankney, G. J. Hidding
• Published 2005
• Business

Recent research into the theory of first-mover advantage has revealed that a significant number of first-movers in I.T.-driven markets eventually lose market leadership. The belief in first-mover advantage spawned a pervasive body of work in business strategy and was further perpetuated by popular media.  The assumption of first-mover advantage has been extended by research suffering from survivor bias, whereby pioneers were recognized only among surviving firms. Instead, recent research suggests that fast-followership may offer an important strategic advantage.  For example, in their study of 27 I.T.-driven product categories, Hidding and Williams (2003) found that a fast follower gained market leadership, on average, 60 percent of the time.  Although many hypotheses for fast-follower advantage have been suggested, few have been empirically tested.  There is a particular d e a r t h   o f   r e s e a r c h   i n t o   f a s t - f o l l o w e r s h i p   b a s e d   o n   p o s i t i v e   n e t w o r k externalities, which is of particular relevance in I.T.-driven markets.  To stimulate the pursuit of such research, this paper presents a conceptual framework and a set of propositions that recognize key factors pertaining to network externalities that contribute to fast-follower advantage in I.T.-driven markets.