Edited by Ruth Towse and Christian Handke
Many firms operating in the creative industries are confronted with dynamic competition. The dynamic competition in many creative industries can be explained by worldwide deregulation and privatization trends that have contributed to a decrease in natural monopoly structures (Daidj, 2011). However, the key driver of dynamic competition over time is technological innovation (Evans and Schmalensee, 2002). Owing to the technological development, the structure of those creative industries has changed fundamentally (see, for example, Greenstein and Khanna, 1997; Kranenburg et al., 2001; Pennings and Puranam, 2001; Stieglitz, 2003; Christensen, 2011). The convergence of digital and interactive (information and communication) technologies accelerates the erosion of existing industry boundaries. This development raises the question of how competition and structural changes in the creative industries are accompanied by changes in industry boundaries and how firms can cope with these changes and forces of competition. In this chapter we start with a discussion on dynamic competition and industry convergence and how they affect the business landscape. Next we will discuss how firms can build a competitive position in a dynamic and convergent environment by addressing the strategy of ambidexterity and critical capabilities for firms to operate in the changing business landscape.
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