Clashes between contending market regimes: a challenge for firms in converging industries

Purpose - The purpose of this paper is to develop a conceptual framework that describes three contending market regimes in converging industries, and to use this framework to study clashes between different regimes and the implication they have on firms' competitive strategies. More specifically, the challenges of competitors simultaneously acting in accordance with a competitive, a cooperative, and a co-opetitive market regime. Design/methodology/approach - An exploratory case study of the interaction between firms within the IT and telecom industry is conducted. Findings - The paper brings forward clashes between different market regimes in converging industries and six propositions are formulated. The study furthermore shows how firms respond differently to a demand-driven convergence, some act in accordance with a competitive regime and try to exclude others whereas others act in accordance with the co-opetitive regime and cooperate with competitors to develop new product offers. Research limitations/implications - The paper concludes that there are several challenges in transforming from a competitive to a co-opetitive regime, and there is therefore a need to further explore the clashes observed in this study. Originality/value - Few empirical studies have been conducted of the converging IT and telecom industries and this paper reveals several new insights about this market context and the challenges it provides. The paper develops a theoretical framework for an analysis of converging industries and provides an insight about clashes that develop between different market regimes. It also describes the challenges firms are facing as a result of these clashes.