2004 Volume 13 Issue 2 Pages 1-35
The purpose of this paper is to propose an analytical framework for examining the change of the competitive advantage of business characterized by progressed industrial modularization. The research is undertaken through a case study of the Internet service provider business (ISP). The business seems to be one of the industries in which industrial modularization is typically progressing. The industrial modularization in the business in Japan is caused by standardization of telecommunications protocol and encouragement of partial entry using the NTT infrastructures.
In the paper, first, the analysis of historical changes of competitive situation in the ISP industry shows the validity of the framework. Secondly, the practical validity of the framework is demonstrated by proposing the prediction procedure of competitive situation in the future ISP industry. This research is also checking the validity of the hypothesis, “the competitive advantage of business characterized by progressed industrial modularization is fundamentally determined by what kind of industrial modules to hold,” according to the case study as a result.
