EconPapers    
Economics at your fingertips  
 

Sponsors, Communities, and Standards: Ethernet vs. Token Ring in the Local Area Networking Business

Urs von Burg and Martin Kenney

Industry and Innovation, 2003, vol. 10, issue 4, 351-375

Abstract: The discipline of economics has treated technological standards creation as an outcome of network externalities and decisions on the demand side. They pay little attention to the supply side, where firms make strategic choices as to which standard to support. These choices can ignite a contest between adherents to the different proposed standards. This case study examines the contest between the Ethernet and Token Ring standards for local area networking. IBM sponsored Token Ring, but then made it difficult for other firms to be successful in supplying components. In contrast, Ethernet's sponsors, DEC, Intel, and Xerox, structured the marketplace in such a way as to encourage supporters. The resulting Ethernet community was able to lower costs and improve the technology so dramatically that the Token Ring standard, which had initially been technically superior, was overwhelmed. We find that the critical difference in explaining the success of Ethernet was the nature and strategy of the standard's sponsors in assisting the growth of a community of firms supporting the standard.

Date: 2003
References: View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.tandfonline.com/doi/abs/10.1080/1366271032000163621 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:indinn:v:10:y:2003:i:4:p:351-375

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/CIAI20

DOI: 10.1080/1366271032000163621

Access Statistics for this article

Industry and Innovation is currently edited by Associate Professor Mark Lorenzen

More articles in Industry and Innovation from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().

 
Page updated 2025-03-20
Handle: RePEc:taf:indinn:v:10:y:2003:i:4:p:351-375