Methlie & Gressgård: Structural conditions and business models EXPLORING THE RELATIONSHIP BETWEEN STRUCTURAL MARKET CONDITIONS AND BUSINESS CONDUCT IN MOBILE DATA SERVICE MARKETS

A business model represents the decision space for strategic options of a firm. These options are determined by the market situation in which the firm operates. Among these options the firm makes its strategic decisions which are evaluated by the firm’s performance in the market measured by business values. Thus, there is a link between market conditions, business model choices, and performance. This link was first formulated in the structure-conduct-performance (SCP) framework in the field of industrial organization, which links together the supply-side with the demand-side. MAPIT is a framework for understanding the structural conditions under which intermediaries and platform providers in online markets choose their strategies, roles and functions. In this paper, five case studies of mobile data service providers are analyzed and described using the MAPIT conceptual framework. The fundamental concept in this framework is integration – vertical integration of activities along the value chain, and horizontal integration across value chains. For each case, we describe the relationships between specific structural conditions and the business model choices made by the service providers. Finally, the findings on business model options are generalized across cases and some industry implications of the observations are made