How do new entrants’ pre-entry technological backgrounds impact their cross-industry innovation performances? A retrospective study of the mobile phone vendors

Abstract

With the tides of new entrants constantly driving the extension of an industrial technology trajectory, how does the new entrants' divergent technological backgrounds impact their cross-industry innovation performances? To answer this question, we investigated the new entrants' pre-entry technological background, including their accumulated technology (T1) different from that of their targeted industry of entry (mobile phone industry) as well as degree of the technology difference (TD), and examined their impacts on the new entrants' cross-industry innovation performance. The empirical results confirmed a positive role of the T1, and a curvilinear impact of the TD on the firms' cross-industry innovation performance after their official entry. However, those effects gradually turn to be either weaker or insignificant. Instead, the obvious impact of the new entrants' technology accumulation pertinent to mobile phone industry (T2) after the entry is positively moderated by the TD, whereas the T1's impact on cross-industry innovation performance is negatively moderated by the TD. We discussed the theoretical and practical implications of these empirical findings at the end of this study.