“…then came Cisco, and the rest is history”: a ‘history friendly’ model of the Local Area Networking industry
Roberto Fontana () and
Working Papers from Dipartimento Scienze Economiche, Universita' di Bologna
We study the role that switching costs, compatibility, and mergers and acquisitions, play in influencing the evolution of a multi-market industry. By looking at the case of the Local Area Networking industry, we propose a ‘history friendly model’ to replicate its evolution during the 1990s. Our model explains how a firm can start from a dominant position in one of the existing markets and exploit switching costs and compatibility to enter a new market when it opens. Mergers and acquisitions also play an important role as the new market is pioneered by a new start-up, which is soon acquired by the dominant incumbent. As a result of the acquisition, the acquiring firm becomes leader also in the new market.
JEL-codes: L10 L63 O30 (search for similar items in EconPapers)
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Journal Article: “…then came Cisco, and the rest is history”: a ‘history friendly’ model of the Local Area Networking industry (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:bol:bodewp:wp993
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