Drivers of Internationalisation in Network Industries: The Case of Electronic Purse Developers

Abstract

This paper analyses how e-purse developers have tried to penetrate international markets. The analysis covers the period between 1992 and 2006, and builds on 16 firm-level case studies that span developments in more than 30 countries around the globe. The paper uses a novel multi-dimensional framework to position the firms at different points in time, and in this way detect patterns of strategic change. The paper then examines drivers behind these internationalisation patterns, as well as the pace and organisational form, by building on the approach proposed by Sarkar et al. (1999) for the telecom sector. The paper finds that the quest for enhanced power in standard-setting debates appears to have been particularly important as a driver, and it is shown that once promising national platforms were relegated to also-rans because they lacked a successful internationalisation strategy. It also shown that, just like telecommunication carriers, e-purse developers have followed strategies of market and partner preemption, albeit for different reasons. An interesting theoretical finding is that, with some adjustments, the Sarkar et al. framework can be transposed to another network industry.