Co-opetition Strategies of e-Reader Firms---A Case of Amazon, Barnes & Noble and Sony
Date Issued
2012
Date
2012
Author(s)
Chen, Yi-Ming
Abstract
E-books and e-book readers have been discussed in the publishing industry since 1990. Amazon launched Kindle in 2007. It has combined hardware, software, contents, wireless internet and platforms sucessfully and created a new business model and thus changed the ecosystem in this industry. With the popularity of digital reading, people have changed the habit of reading and consuming gradually. In the foreseeable future, relevent industries will rise and create another digital revolution.
Based on value net model and co-opetition strategies proposed by Brandenburger & Nalebuff(1996), this research first provides analyses on e-reader industry. Then we put the representative firm Amazon in the center of value net and put Barnes and Noble, Sony in the Competitors block. After that we analyze the value net of Amazon and the relationships with other players. Furthermore, we analyze the co-opetition strategies of Amazon based on PARTS. Finally, we generalize the distict co-opetition characteristics and give suggestions in the e-reader industry for incumbent and potential firms.
This research finds that there are two main co-opetition characteristics from the industry perspective. First, tablet PC and smart phone play the role of competitors and complementors simultaneously. Second, traditional publishers are also competitors and complementors. Besides, we can find four main co-opetition relationships in the value net of Amazon. First, e-reader firms like B&N Sony, tablet PC and smart phone compete capacity of suppliers with Amazon. They can also form purchasing alliance. Second, e-reader firms like B&N Sony, tablet PC and smart phone not only compete customers but also be regarded as complementors for Amazon. Third, publishers also play the role of digital content providers. Fourth, customers become individual writers and meanwhile become complementors of Amazon.
Finally, this research suggests that the key success factor of Amazon lies not in the hardware but in the innovation of business model, contents and services, complementors and the capabilities of turning competitors into complementos. In addition, firms in e-reader industry can consider the following co-opetition strategies, including cooperation with publishers and writers, development of cross-platform apps, jointly procurement from suppliers, other complementors, imitation of competitors and provision of publishing platforms.
Subjects
value net
co-opetition
e-readers
Amazon
Type
thesis
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