Wednesday, August 04, 2004
Another draft of a piece in progress - Enjoy!
9 Strategic Uses of Open-Source
1. Open up to complementors outside your industry, expanding the market horizontally, blurring industry boundaries, and thus relatively devaluing your rivals� strategic options and future market power.
2. Open up to suppliers and buyers, raising their switching costs by increasing the gains to integration. This implicitly locks-in the market vertically. Don�t confuse this with explicit (evil) lock-in.
3. Open up to everyone, disrupting everybody�s position (even your own). This exerts maximum innovation pressure over your entire ecosystem. Only use this strategy when you�re got innovation capital you can deploy � when you�re ready to disrupt your own position, but your competitors aren�t ready to be disrupted.
4. Open up to complementors inside your industry (usually downstream from you), hypercommoditizing your own product � but also exerting total price competition over your rivals.
5. Open up to complementors inside your industry (usually downstream from you), hypercommoditizing your own product � but also vastly increasing innovation pressure among complementors, rapidly and massively multiplying the value created by your product (by forcing your complementors to hyperinnovate against one another)..
5. Open up to complementors inside your industry (usually downstream from you), hypercommoditizing your own product � but also establishing it as the (or as part of the) dominant design which coordinates your industry.
6. Open up to complementors inside and outside your industry, vastly increasing the range of strategic options you can generate, giving yourself greater strategic space to innovate in, thus massively increasing the future value of innovation pressure you can generate.
7. Open up to consumers � harnessing the explosive power of user innovation, which acts as a multiplier for your ability to exert innovation pressure over your competitors.
8. Open up to multiple selected potential competitors, trading your protected position for co-opting and internalizing the gains from their technological advantage, and giving yourself platform dominance.
9. Open up to multiple selected potential competitors and sidestep hypercompetition by moving upstream or downstream, thus simultaneously co-opting their technological advantage, multiplying selection pressure amongst them, and turning them into hypercommoditized complementors whom you can exert platform leverage and innovation pressure over.