Capturing value from early stage technology in open standard environments: the case of Wi-Fi

This research examines how new firms capture value from an early stage technology built on open standards. The relationship between six attributes of new Wi-Fi service providers’ business models and company performance is examined first and then new and established service providers are compared based on attributes of their business models. Ten hypotheses were tested using data drawn from 22 new and 40 established providers of Wi-Fi services in North America. The results suggest a business model for new service providers that entails: (i) offering more services and targeting more markets than those offered and targeted by established rivals; (ii) pricing the core service at 65% of established rivals’ average price; (iii) partnering with more companies than established rivals do; (iv) partnering with more different types of companies than established rivals do; and (vi) partnering with at least one large company.