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Does Open Source Hardware Have a Sustainable Business Model? An Analysis of Value Creation and Capture Mechanisms in Open Source Hardware Companies

Part of: Innovation Engineering

Published online by Cambridge University Press:  26 July 2019

Zhuoxuan Li  and
Warren Seering

Abstract

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Analyzing value creation and capture mechanisms of open source hardware startup companies, this paper illustrates how an open source strategy can make economical sense for hardware startups. By interviewing 37 open source hardware company leaders, 12 company community members as well as analyzing forum data of 3 open source hardware companies; we realize that by open sourcing the design of hardware, a company can naturally establish its community, which is a key element for a company's success. Establishing a community can increase customer perceived value, decrease product development and sales cost, shorten product go-to-market time, and incubate startups with knowledge, experience and resources. These advantages can compensate for the risks associated with open source strategies and can make open source design a viable product development strategy for hardware startups.

Keywords

Open source designOpen innovationEntrepreneurshipBusiness models and considerations

Information

Type
Article
Information
Proceedings of the Design Society: International Conference on Engineering Design , Volume 1 , Issue 1 , July 2019 , pp. 2239 - 2248
Creative Commons
Creative Common License - CCCreative Common License - BYCreative Common License - NCCreative Common License - ND
This is an Open Access article, distributed under the terms of the Creative Commons Attribution-NonCommercial-NoDerivatives licence (http://creativecommons.org/licenses/by-nc-nd/4.0/), which permits non-commercial re-use, distribution, and reproduction in any medium, provided the original work is unaltered and is properly cited. The written permission of Cambridge University Press must be obtained for commercial re-use or in order to create a derivative work.
Copyright
© The Author(s) 2019

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