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The Internationalization of Electronic Purse Networks: National Responsiveness vs. Benefits of Integration
Abstract
This is a companion paper to Van Hove (2007). The latter paper builds on 16 firm-level case studies to examine the drivers behind the internationalization efforts of e-purse developers. Specifically, the paper tries to find out whether the approach proposed by Sarkar et al. (1999) for the telecom sector can be transposed to another network industry. Van Hove (2007) obviously only uses fragments of the underlying case studies. This paper offers all 16 case studies in full. Van Hove (2007) also uses a novel multi-dimensional framework to position e-purse operators at two points in time, and in this way detect patterns of strategic change. This paper explains the positions of the players in these figures in more detail, and also applies the framework a third time (for the period after the sale of Proton World International).
... Furthermore, Banksys, Danmønt, SIBS, and Toimiraha (the precursor of Automatia) were all members of the Technical Steering Committee 75 . All four were basically small players with a small home market, but as the case studies in Van Hove (2006c) illustrate, at the time they were at the forefront of developments in the e-purse market. Note that these positions changed over time: in spite of their bigger home market, the German banks, for example, were not a member of the Technical Steering Committee of the first working group just mentioned, but when the Common Electronic Purse Specifications were eventually announced -in 71 Mooijman, R., Proton wil wereldwijd de beste zijn, De Morgen, August 1, 1998 June 1998 -ZKA was present (see 2.3). ...
This paper analyses how e-purse developers have tried to penetrate international markets. The analysis covers the period between 1992 and 2006, and builds on 16 firm-level case studies that span developments in more than 30 countries around the globe. The paper uses a novel multi-dimensional framework to position the firms at different points in time, and in this way detect patterns of strategic change. The paper then examines drivers behind these internationalisation patterns, as well as the pace and organisational form, by building on the approach proposed by Sarkar et al. (1999) for the telecom sector. The paper finds that the quest for enhanced power in standard-setting debates appears to have been particularly important as a driver, and it is shown that once promising national platforms were relegated to also-rans because they lacked a successful internationalisation strategy. It also shown that, just like telecommunication carriers, e-purse developers have followed strategies of market and partner preemption, albeit for different reasons. An interesting theoretical finding is that, with some adjustments, the Sarkar et al. framework can be transposed to another network industry.
The aim of this paper is to show that the network externalities theory provides a useful framework to analyse the introduction and further development of the new electronic payment instruments currently being launched. To that end the paper presents a pragmatic (and selective) reading of the network externalities literature; i.e., it screens the literature in search of both theoretical insights and empirical results which can be transposed to the case of electronic payment instruments. In so doing, the paper concentrates on the so-called electronic money products and, especially, on electronic purses. Specifically the paper shows that the network externalities literature provides a number of useful insights concerning consumer reactions to the introduction of electronic purses (and the ways in which card issuers can anticipate these reactions) and concerning the strategies card issuers may follow in a competitive market with incompatible electronic purses. All this is substantiated by multiple references to real-life situations.
The first section of the paper defines the concept of network externalities. The third section demonstrates that payment cards in general are indeed network goods. It also points out which kind(s) of network effects apply to the electronic purses currently available. The paper then goes on to answer five questions in depth. Firstly, what can we learn from the network externalities literature as far as the ‘chicken-and-egg’ problem is concerned? — the problem being: merchants will not invest in terminals without a sufficient number of potential users, while the general public will not use electronic purses unless there is sufficient acceptance. Secondly, is there room for more than one incompatible electronic purse, or is the electronic purse market prone to ‘tipping’ and ‘lock-in’? Thirdly, can an electronic purse issuer gain a (decisive) first-mover advantage by entering the market before others do? Fourthly, under which conditions will card issuers be inclined to make their electronic purses compatible? And finally, what is the optimum pricing strategy for an electronic purse issuer?
Most frameworks used to aid managerial decision- making in multinationals are largely based upon data collected in the manufacturing sector. This article examines how far these frameworks apply to the service sector. Based upon the analysis of nine case studies of multinational service firms, we conclude that ‘transnationalism’ may require different strategic capabilities in the service sector from those in manufacturing.
Should governments make electronic money legal tender at some point in the future? The monetary authorities of Singapore are c onvinced they should, and have aired their vision " to establish an electronic legal t ender s ystem by 2008". This paper presents a comprehensive overview of t he arguments in favour of making electronic money legal t ender, as well as the arguments against such a decision. The planned Singapore Electronic Legal Tender (SELT) system is also used as a stepping stone to study the ramifications of a more ex treme scenario in which traditional cash is completely abolished - a cashless society, in other words.
Ways to make retail payments using the internet and mobile phones are proliferating. Some are offering new access routes to existing payment means, others use different means to transfer value, but all attempt to provide greater convenience and choice in payment services. Few, however, have reached critical mass and none has displaced existing payment methods. Nevertheless, the prospect that these new services could be widely used raises some policy questions. For example, central banks are interested in any potential effects on financial stability and, in the longer term, in whether such innovation might have monetary policy implications. For these reasons, central banks monitor the evolution of the market, even though any such impacts may be a long way off. Moreover, it may well be that the system-wide risks will be relatively small even if e-payment usage becomes significant.
This paper discusses the internal patterns of competence building in the multinational enterprise (MNE), with a focus on the creation of capabilities in its foreign subsidiaries. We present a new framework to synthesize 10 types of MNE–subsidiary linkages leading to capability development. We find that several of the 10 capability development processes are associated with subsidiary-specific advantages. We discuss the process of subsidiary-specific advantage development within the organizational structure of the MNE when it is a differentiated network of dispersed operations. Copyright © 2001 John Wiley & Sons, Ltd.
Between 1997 and 2001, two mid-sized communities in Canada hosted North America's most comprehensive experiment to introduce electronic cash and, in the process, replace physical cash for casual, low-value payments. The technology used was Mondex, and its implementation was supported by all the country's major banks. It was launched with an extensive publicity campaign to promote Mondex not only in the domestic but also in the global market, for which the Canadian implementation was to serve as a "showcase." However, soon after the start of the first field test it became apparent that the new technology did not work smoothly. On the contrary, it created a host of controversies, in areas as varied as computer security, consumer privacy, and monetary policy. In the following years, few of these controversies could be resolved and Mondex could not be established as a widely used payment mechanism. In 2001, the experiment was finally terminated. Using the concepts developed in recent science and technology studies (STS), this article analyzes these controversies as resulting from the difficulties of fitting electronic cash, a new sociotechnical system, into the complex setting of the existing payment system. Implementing a new technology is seen as a long process in which social and technological actors are required to adapt to one another. In the Mondex case, such adaptation did not happen sufficiently to stabilize the sociotechnical network as a whole. However, in some limited areas mutual adaptation did occur, and there the Mondex experiment produced some surprising successes. In this perspective, the story of Mondex not only offers lessons on why technologies fail, but also offers insight how short-term failures can contribute to long-term transformations. This suggests the need to rethink the dichotomy of success and failure.
This paper uses a unique data set covering 12 national systems to document the current state of electronic purse projects in Europe. Specifically, it presents and compares rates of penetration and use, and analyses their evolution over time. While one or two EPs perform significantly better than the others, retailer acceptance and consumer uptake invariably fall short of expectations. This does not bode well for the use of EPs on the Internet, and particularly since the virtual world presents a number of additional hurdles. On the other hand, it may also present additional opportunities.
We are witnessing a shake-out in the European electronic purse market. Several cards that have been in the market for years have or are about to disappear. On the other hand, there are a number of schemes that are doing reasonably well, particularly in the Benelux. This article looks at the mixed experience with e-purses in Europe from a pragmatic point of view and tries to highlight the mistakes that were made by the losers and the smart moves that helped the winners. The article tries to summarize the lessons learned in six 'smart moves'. These lessons should be of interest to newer e-purse schemes elsewhere in the world, but also to other novel payment solutions that target the market for low-value payments.
Omslagtitel: Payment instruments and network effects. - Auteursnaam op omslag: Gottfried Leibbrandt. Proefschrift Universiteit Maastricht. Met lit. opg. - Met samenvatting in het Nederlands.
This paper examines the internationalization process of telecommunication carriers. In this industry, early entrants gain substantial first-mover advantages due to the transient nature of the windows of market opportunity, and the potential to influence the regulatory process as an incumbent. To capture these strategic and economic advantages, firms follow a strategy of preemption, both of markets and partners. The authors argue for the need to augment prevailing theory with contextual idiosyncrasies that characterize specific industries.© 1999 JIBS. Journal of International Business Studies (1999) 30, 361–381
This paper documents the recent performance of European electronic purses. It presents data on 16 such schemes, and compares their penetration and usage rates. These rates are shown to differ substantially. A number of schemes are doing increasingly well and in all probability are here to stay. These schemes have also received a boost from the introduction of the euro. But a number of other schemes are making little or no headway. Some have even experienced a relapse and appear to be on the verge of disappearance. The paper tries to identify explanations for these disparate fates.
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173 Note that Europay was convinced of the opportunities of the Internet for e-purses early on: "Electronic commerce,
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206 Ibidem.
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211 Ibidem.
Card firm in CP deal 49 Note that the card has three main uses – for money transfers, as an e-purse, and as a loyalty-and-membership card. The money-transfer application was launched Easy money: electronic purse to be ready for customers early next year, The Nation
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49 Note that the card has three main uses – for money transfers, as an e-purse, and as a loyalty-and-membership card. The
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MasterCard International -Mondex For a brief period MasterCard International experimented with its own e-purse product
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- Although
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