Value implications of open source software : an empirical outlook to the open innovation model
Year: 2013
Type: dissertation
Abstract: This thesis consists of three essays on open source software (OSS) phenomenon, \nwhich constitutes a suitable setting for investigating the open innovation paradigm and \nthe benefits of firm-community collaborations for a firm. \nThe first essay examines the impact of firms’ stocks of intellectual property right \nendowments on the relationship between firms’ OSS product portfolio and its firm \nvalue. The results suggest that firms taking more commercial actions in OSS paradigm \nenhance their firm value in the presence of large stocks of software patents. On the other \nhand, software trademark stocks have a negative effect on this relationship. Several \npotential explanations are proposed in the study, which emphasizes the importance of \nintellectual property right protection mechanisms for those firms that aim at building an \nOSS-based product portfolio. \nThe second essay investigates the benefits that might accrue to a firm from their \ncode contributions as reflected in stock market prices. The study builds on recent work \nin the area of community-based innovation and tries to explain why a firm might benefit \nfrom contributing to the commons. The hypotheses are tested on a novel data set that \ncaptures the stock market responses to 149 press releases made over a thirteen-year \nperiod. The findings suggest that open source code contributions generate positive, \nabnormal returns for the contributing firm. In addition, we find that contributions of \nnew code rather than existing code generate greater value for the firm—and that \ncontributions of new code to software projects targeted at end-users rather than \ndevelopers systematically generate even greater returns. \nThe third essay focuses on collaborations among firms and communities for \nobtaining better outcomes from open source projects. In specific, this study aims to \ndisentangle how organizational design may affect the performance of an OSS project. \nProject’s management model and employee involvement in the project are treated as \npotential mediators that may have an effect on the aforementioned relationship. The \nempirical analysis is undertaken on a sample of OSS projects hosted on the platform \nSourceForge.net from December 2006 to December 2008. The findings of this study are \nthree fold. First, being directly involved in a project with a specific policy on OSS has a \npositive effect on project’s performance. Second, coordination by firm has a negative \neffect on performance. Third, admin as an employee on main duty does not have a \ndirect positive effect on performance. However, it positively moderates the \naforementioned relationship. \nThe contributions of these essays to the existing literature can be articulated as \nfollows: The first essay contributes to the current debate on commercialization of OSS, \nmainly, by establishing the intermediary effect of firms’ IPR holdings on the \nrelationship between OSS commercialization and performance. IPR mechanisms in the \nform of software patents and software trademarks needed to be investigated as they are \ncrucial firm resources in appropriating returns. This study sheds light on how much \nthese mechanisms matter for performance consequences of commercializing OSS. \nMoreover, the study empirically shows how mismatching strategies may harm a firm’s \nperformance while the firm attempts to move towards a new business model for better \noutcomes. \nThe second essay contributes to the literature on community-based innovation \nby enhancing our understanding of the process by which firms can work within \ncommunities. Literature on open innovation encapsulates community-based innovation, \nas well as other mechanisms by which the firm searches its external environment for \nknowledge. Other mechanisms—alliances, joint ventures, university collaborations— \nhave been the object of much empirical and theoretical attention in the strategy and \ntechnology management literatures. In contrast, community-based innovation has been \nthe object of less scholarly work, but has attracted the attention of academics and \npractitioners alike, and firm engagement with communities appears to be on the rise. It \nalso contributes to the literature on learning, where communities can provide valuable \nknowledge to firms, by providing systematic empirical documentation. \nThe third essay contributes to knowledge on benefits of collaborations between \nfirms and OSS communities. Firm’s role in the complex coordination mechanism of the \nproject on project’s success has been investigated. Along this line, the paper can also \ndirectly inform managers on the strategies they should apply to assure long term \nsustainability of their external knowledge sourcing activities through communities. \nManaging the boundaries of collaborations is essential. Written rules and guidelines \nlead to fruitful joint development of software.
Language: English
Subfield: Computer Science Applications
Field: Computer Science
Domain: Physical Sciences
Open Access status: green
OpenAlex ID: W2183962518