The Digital Metamarket

The Digital Metamarket

Margherita Pagani (I-Lab Research Center on Digital Economy, Bocconi University, Italy)
DOI: 10.4018/978-1-93177-738-4.ch001
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Abstract

The world’s emerging multimedia market results from the process of convergence of three industries which were created at an interval of 50 years respectively—the telephone industry (1890), the television industry (1930), and the computer industry (1980). Convergence describes a process change in industry structures that combines markets through technological and economic dimensions to meet merging consumer needs. It occurs either through competitive substitution or through the complementary merging of products and services, or both at once (Dowling, Leichner & Thielman, 1998). Convergence is a phenomenon by which previously separated sectors end up being part and parcel of one big metamarket (Valdani, 1997), thus generating an effective merging of previously different sectors. A terminology specification appears to be right and proper—a specification adopted by the theory of business economics which conceptually defines the meaning of sector, industry, and market based on three dimensions of analysis.1 According to such terminology, the sector is characterised by all the customers’ groups (first dimension), by all the required functions (second dimension), based on the same technology (third dimension). On the other hand, within the confines of such taxonomy, the concept of industry expresses the vertical relations among the sectors. Industry detects the globality of vertically linked sectors, starting from the production of raw materials up to the gleaning of products destined to intermediate or final consumption. Changes in the relations and among the confines of the different sectors are of the utmost importance in changing both the industry and the market structure. Thus, based on the assumption that the definition of “sector” has to do with the uniformities evidenced on the offer side, the definition of industry relates to the process of productive verticalization, the definition of “metamarket” or complex market, widens the business’s competitive area to include those products deemed as surrogate in terms of technology within those usage situations where similar functions and benefits are required.

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