Title: Are service-based business models of the video game industry blueprints for the music industry?

Authors: Florian Waldner; Martin Zsifkovits; Kurt Heidenberger

Addresses: Faculty of Business and Economics, University of Vienna, Bruenner Strasse 72, 1210 Vienna, Austria ' Faculty of Business and Economics, University of Vienna, Bruenner Strasse 72, 1210 Vienna, Austria ' Faculty of Business and Economics, University of Vienna, Bruenner Strasse 72, 1210 Vienna, Austria

Abstract: The internet, peer-to-peer technology and mobile devices are radically changing markets for digital media such as recorded music. Incumbent companies in these industries have severe difficulties in reacting to these changes and finding effective business models. The fundamental challenge is how to capture value from delivering digital music files which users expect to download for free. It is the consumer's capability to handle digital content that opens up possibilities for new business models where consumers are active partners helping to co-create value along with companies. Compared to the music industry, the video game industry was more successful in adapting its business models. By conducting an exploratory study among recently founded video game startups and two case studies of music-technology startups, whether and how the video game industry is a vital source from which to draw analogies for the music industry will be analysed in this paper.

Keywords: value co-creation; cross-industry innovation; music industry; video games industry; virtual commodities; business models; service science; digital media; service-based business modelling; digital music; video game start-ups; music technology start-ups.

DOI: 10.1504/IJSEM.2013.051862

International Journal of Services, Economics and Management, 2013 Vol.5 No.1/2, pp.5 - 20

Received: 01 Jun 2012
Accepted: 16 Oct 2012

Published online: 02 Feb 2013 *

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