Strategies for Internet Middlemen in the Intermediation/Disintermediation/Reintermediation Cycle

This work identifies four major competitive strategies firms use in the IDR cycle: partnering for access, technology licensing, partnering for content, and partnering for application development and reveals that each strategy requires a different combination of firm capabilities and environmental conditions.

Abstract

Abstract The emergence of new technologies for electronic commerce on the Internet makes possible different ways of interacting for all the players in a market. This transformation of the traditional market interaction can be understood in terms of an intermediation, disintermediation and reintermediation (IDR) cycle. By looking at a series of minicases of the IDR cycle in various industries, we are able to identify four major competitive strategies firms use in the IDR cycle: partnering for access, technology licensing, partnering for content, and partnering for application development. We then analyze the conditions under which these strategies help a firm to achieve sustainable competitive advantage in its marketplace. Our analysis reveals that each strategy requires a different combination of firm capabilities and environmental conditions. As a result, these middlemen should not rely on technological innovation alone if they want to be successful in the marketplace. Keywords: ElectronicCommerceIntermediationDisintermediationReintermediationCompetitiveAdvantage