An analytical framework for evaluating peer-to-peer business models

Abstract

While existing research on peer-to-peer (P2P) file-sharing services has increased our understanding in many respects, it has not yet supplied a comprehensive theoretical framework that explains business failures of P2P file-sharing network service models. We develop such an analytical model and base it on seven specific market constraints – technical, economic, structural, legal, political, cognitive, and cultural – that are specifically relevant for P2P services. We show how our model can be used as a tool for strategic analysis of P2P business model performance using Napster as a particular case of study. We show also how P2P file-sharing networks have migrated through a series of system typologies by incorporating technological innovations in response to market constraints. Finally, we offer a new theoretical conceptualization that views P2P file-sharing networks as electronic markets.