Can User Innovation Grow a Firm? The Case of the Korean Smart Media Industry

With the rapid development of information and communications technology (ICT), smart society has arrived. The emergence of smart media has changed the user's role. Broader communication coverage, faster Internet speeds, and an expanding application market promote user participation. Therefore, the role of users in innovation has become more important than ever. In this rapidly changing environment, it has become important for firms to consider the role of users when developing innovation strategies. It is hard for a firm to maintain all abilities and resources amid this sudden change; therefore, firms have to develop their strategy considering the user's role. For that reason, firms need to network with universities, researchers, firms, and users from the open innovation perspective. This study divides firm strategy into exploitation and exploration strategies in the value chain and identifies the effects of utilization strategy, exploration strategy, and the role of users in the smart media industry on firm performance.