The Jukebox Mode of Innovation - a Model of Commercial Open Source Development

In this paper, I describe and analyze the phenomenon of informal development collaboration between firms in the field of embedded Linux, a type of open source software. To explain the observed phenomenon of voluntary revealing, I develop a duopoly model of quality competition. The central assumptions are that firms require two complementary technologies as inputs, and differ with respect to the relative importance they attach to these technologies. The main results are, first, that a regime with compulsory revealing can lead not only to higher profits, but also to higher product qualities than a proprietary regime. Second, when the decision to reveal is endogenized equilibria arise with voluntary revealing by both players.Innovation; development collaboration; open source software; embedded Linyx

Defensive Publishing An Empirical Study

Defensive Publishing denotes publication of an invention with the purpose of creating prior art, and thus preventing patents being granted on this invention. Although widely employed, it has hardly been investigated empirically. Our study is based on 56 in-depth interviews, among others with most industrial firms in the German DAX 30 stock index. We find that 70 percent of the companies in our sample use defensive publications, for up to one third of their inventions. Interestingly, we find that the patent system itself is frequently used for defensive publishing. Our findings also challenge contributions connecting defensive publishing to patent races.Defensive publication, Intellectual property, Freedom to operate, Patens

Patent Portfolio Races in Concentrated Markets for Technology

Patent application numbers grow exponentially in many industries, a phenomenon that has been linked to high fragmentation of patent ownership. Contradicting these findings and theoretical arguments, we show that such fragmentation is not a precondition for sudden and strong increases in patenting. We describe and analyze a patent portfolio race in an industry with highly concentrated patent ownership, namely the newspaper printing machines oligopoly. Triangulating data from patent analysis, interviews, and document research, we find that patent strategy change by one player triggered a patent portfolio race with its main competitor. Implications for managers are that increasing patent output may yield temporary advantages but, as in a price war, implies the risk of a prisoner’s dilemma-type outcome with potentially severe implications for effectiveness and efficiency of the innovation process.Patent Strategy; Motives to Patent; Intellectual Property; Patent Thickets

Venture Capitalists' Evaluations of Start-up Teams: Trade-offs, Knock-out Criteria, and the Impact of VC Experience

The start-up team plays a key role in venture capitalists' evaluations of venture proposals. Our findings go beyond existing research, first by providing a detailed exploration of VCs' team evaluation criteria, and second by investigating the moderator variable of VC experience. Our results reveal utility trade-offs between team characteristics and thus provide answers to questions such as "What strength does it take to compensate for a weakness in characteristic A?" Moreover, our analysis reveals that novice VCs tend to focus on the qualifications of individual team members, while experienced VCs focus more on team cohesion. Data was obtained in a conjoint experiment with 51 professionals in VC firms and analyzed using discrete choice econometric models. (author's abstract

Fremdvergabe von IT-Dienstleistungen aus personalwirtschaftlicher Sicht

Die Nutzung von Informationstechnologie (IT) nimmt weiter zu. Gleichzeitig besteht ein Mangel an Fachkräften. Da spezialisierte IT-Unternehmen Vorteile bei der Akquisition dieser Mitarbeiter haben, wirkt sich der Mangel an Spezialisten positiv auf das Ausmaß des Outsourcing von IT-Dienstleistungen aus. Auch andere personalwirtschaftliche Aspekte sollten einen starken Einfluss zeigen. In diesem Artikel werden zuerst die personalwirtschaftlichen Bestimmungsfaktoren der IT-Outsourcing-Entscheidung systematisiert. Es folgt eine deskriptive Analyse von IT-Fremdvergabeentscheidungen und der IT-Nutzung des Wirtschaftszweigs "Unternehmensnahe Dienstleistungen". Schließlich werden im Rahmen eines ökonometrischen Modells die Bestimmungsfaktoren von IT-Outsourcing in dieser Branche untersucht. Es zeigt sich, dass personalwirtschaftliche Variablen einen hohen Erklärungsbeitrag liefern. Die Resultate lassen sich u.a. als Beleg für strategische Komplementarität zwischen verschiedenen Outsourcing-Entscheidungen interpretieren

Code Reuse in Open Source Software Development: Quantitative Evidence, Drivers, and Impediments

The focus of existing open source software (OSS) research has been on how and why individuals and firms add to the commons of public OSS code—that is, on the “giving” side of this open innovation process. In contrast, research on the corresponding “receiving” side of the innovation process is scarce. We address this gap, studying how existing OSS code is reused and serves as an input to further OSS development. Our findings are based on a survey with 686 responses from OSS developers. As the most interesting results, our multivariate analyses of developers’ code reuse behavior point out that developers with larger personal networks within the OSS community and those who have experience in a greater number of OSS projects reuse more, presumably because both network size and a broad project experience facilitate local search for reusable artifacts. Moreover, we find that a development paradigm that calls for releasing an initial functioning version of the software early—as the “credible promise” in OSS—leads to increased reuse. Finally, we identify developers’ interest in tackling difficult technical challenges as detrimental to efficient reuse-based innovation. Beyond OSS, we discuss the relevance of our findings for companies developing software and for the receiving side of open innovation processes, in general

Fremdvergabe von IT-Dienstleistungen aus personalwirtschaftlicher Sicht

Dieser Beitrag untersucht die personalwirtschaftlichen Aspekte der Fremdvergabe von IT-Leistungen. Er bietet einen systematischen Überblick über bestehende theoretische und empirische Arbeiten zum Thema IT-Outsourcing und legt dabei einen besonderen Schwerpunkt auf die personalwirtschaftlichen Komponenten der ITFremdvergabeentscheidung. Aus dem Überblick werden Hypothesen hinsichtlich der Wirkungsrichtung verschiedener Determinanten des IT-Outsourcings abgeleitet. Diese Hypothesen werden einem empirischen Test unterzogen. Auf Grundlage eines großzahligen Datensatzes (N=679) wird die Fremdvergabeentscheidung von (i) Betreuung und Wartung von Hard- und Software, (ii) Programmierleistungen und (iii) EDV-Schulungen analysiert. Die Schätzergebnisse zeigen, dass personalwirtschaftliche Variablen wie Weiterbildung, Mangel an qualifizierten Mitarbeitern, Qualifikationsniveau der Mitarbeiter und Unternehmensgröße einen hohen Erklärungsbeitrag liefern. Unsere Resultate lassen sich u.a. als Beleg für strategische Komplementarität zwischen verschiedenen Outsourcing-Entscheidungen interpretieren. -- This paper analyzes those aspects of IT outsourcing decisions that are related to personnel economics. It offers a systematic overview of existing theoretical and empirical studies on that issue. We draw empirically testable hypotheses from our overview and take them to data. Based on a comparatively large data set that comprises of 679 obser-vations, we estimate the determinants of outsourcing (i) hardware and software admini-stration and maintenance, (ii) programming services and (iii) IT training. The estimation results indicate that variables such as training, lack of qualified employees, skill structure of employees, and firm size have significant effects on the decision to outsource IT services. Our results also suggest that strategic complementarities exist between the various outsourcing decisions.

Modularity and Intellectual Property Protection

Modularity is a means of partitioning technical knowledge about a product or process. When state-sanctioned intellectual property (IP) rights are ineffective or costly to enforce, modularity can be used to hide information and thus protect IP. We investigate the impact of modularity on IP protection by formally modeling the threat of expropriation by agents. The principal has three options to address this threat: trust, licensing, and paying agents to stay loyal. We show how the principal can influence the value of these options by modularizing the system and by hiring clans of agents, thus exploiting relationships among them. Extensions address screening and signaling in hiring, the effects of an imperfect legal system, and social norms of fairness. We illustrate our arguments with examples from practice

Digital design protection in Europe : law, trends, and emerging issues

Digital designs – that is, designs for display on electronic screens – have recently burst onto the intellectual property (IP) stage. While in the U.S. a smattering of legal studies have recently addressed the question of digital design as a copyright -, rademark - and patent - eligible subject matter, a European perspective is still lacking in the literature. This study provides an overview of basic legal background to the protection of digital designs in Europe, explores firms’ actual digital design protection behaviors, and highlights some important practical and doctrinal issues that warrant further study