Innovation and Value Migration in Layered Architectures: The Case of Cloud Orchestration Stacks

• Main Authors: TEE, Richard, WOODARD, C. Jason
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2012
• Subjects: Computer Sciences; Management Information Systems
• Online Access: https://ink.library.smu.edu.sg/sis_research/1729; http://userinnovation.mit.edu/conf2012/day_3_talks.html
• Institution: Singapore Management University

Our paper explores strategic decision making in open innovation ecosystems, focusing on the role of design choices in shaping the evolution of technology and industry architectures. Based on an inductive study of two open-source cloud computing initiatives, we highlight how firms' expectations about the creation, capture, and migration of economic value influence their architectural decisions, both from a technological and organizational point of view. Our research setting is distinctive in two ways. First, the cloud computing ecosystem is not confined to a single product category or standard but spans multiple architectural layers. Second, the interactions within the cloud ecosystem take place against a backdrop of significant competitive pressures, both within layers and with respect to vertically integrated rivals. We draw on existing work on technology and industry co-evolution, modularity, and business ecosystems to consider how internal and external forces shape the interactions within this layered architecture.