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We examine a two-period, homogeneous product duopoly model. Consumers choose the supplier that demands the lowest two-part tariff payment. When per unit rates are given, firms’ competition in fixed fees leads to an endogenous segmentation of the market, with positive profit for both firms and consumers self-selecting according to their usage levels. Consumers’ usage levels vary between periods but switching suppliers is costly. Examining various possibilities (including price discrimination between old and new customers) reveals that switching affects the two suppliers asymmetrically, as the average usage level of a firm’s clientele changes.

This chapter is focused on the specification and integration of intercultural variables for human machine systems and the description of content analysis for these variables. Starting with basics of culture-oriented design, these are followed by an approach to machine localization issues and a cost model, then basics of the intercultural design and human machine system engineering process, a definition and specification of intercultural variables, a systematic treatment for their integration into the process, and a description of how to use these variables in the process. Finally, an example of an intercultural variables approach to “information coding” in a human-machine system is presented for China and Germany.

Purpose – This chapter discusses the difference between a product strategy and a platform strategy, relying on examples from the history of Apple and Microsoft in personal computers and other devices as well as Sony and Japan Victor Corporation in videocassette recorders.

Design/methodology/approach – The chapter begins with a review of how the term “platform” has been used in the management literature and defines an industry-wide platform (as compared to an in-house company product platform) as a foundation technology (or service) that brings multiple parties in a market together for a common purpose. An industry-wide platform can generate powerful network effects between the platform and complementary products and services that make the platform increasingly valuable. Apple, with the Macintosh computer, and Sony with the Betamax VCR as well as other products, such as the Walkman media player, are examples of firms that developed excellent products but followed a product-first strategy and ended up losing in these markets or becoming niche players. They paid relatively little attention to opening up their technology to outside firms and cultivating an ecosystem of partners. Apple changed in the early 2000s with the iPod and iTunes, and then the iPhone and iPad, and has risen from near bankruptcy to become an enormously valuable and profitable platform leader.

Findings – Historical examples suggest that, in a platform market, the winner is not the firm with the best product, but rather the firm with the best platform – that is, the foundation technology or service that is most open to outsiders and which stimulates development of the most compelling complements.

Originality/value – This result extends the literature's understanding of platform strategy.

The competence-based management approach has shed light on how firms represent open systems that link assets, strategic logic, and capabilities in order to create new competences. Nonetheless, we find that there are too few empirical studies that illustrate how competences are distributed within an industry. The following case study is based on an in-depth analysis of innovation and standards-formation in industrial automation. Two examples, the standard-setting community PROFIBUS and the field bus-related sensor consortium IO-Link are used to analyze partnership arrangements and competence-distribution patterns.

This study is based on qualitative interviews and it uses patent data to judge competences of a standard-setting community's partner firms. Referring to the empirical case of IO-Link, we show how the integrator firms’ competence-leveraging can be significantly affected by new technology approaches that reason a novel deployment of capabilities. It seems that the deployment of resources depends not only on industry segmentation, but also on the firms’ coordinated agenda concerning innovative, new functionality of a given standard. Our patent analysis also mirrors the variety of knowledge within a standard-setting community. Furthermore, we develop a concept of layered business systems, that is, a terminology of knowledge, organizational, and technology domains. Standard-setting communities bundle complementarity assets, they make their member firms create both proprietary and open technology, and they integrate knowledge across industry boundaries.