Strategizing industry structure: The case of open systems in a low-tech industry

Open systems strategy enables a sponsor to diffuse its technology and promotes standardization in an industry. However, this strategy has been studied in high-tech settings. We hypothesize that, in a non-high-tech industry, a sponsor giving access to its technical knowledge may impact industry structure. Based on a survey of the U.S. tabletop role-playing game (RPG) industry, our results highlight that the introduction of an open system in a sector creates an entry induction phenomenon and that these new entrants adopt more readily the open system than incumbents. Moreover, the average size of the firms in the industry decreases due to vertical specialization. Copyright (c) 2006 John Wiley & Sons, Ltd.