Convergence - Innovation and Change of Market Structures between Television and Online Services

Abstract

Convergence is an often used but rarely defined concept. Ideas such as the creation of synergies, disappearance of industry boundaries, integration, or overlapping of markets, are all used to describe this phenomenon. Where is convergence occurring and what effects has this phenomenon for the industries involved? We give an overview of the current competition and changes in the television and online services industries where important technological, customer-focused and corporate innovations are moving them “closer together”. We define “convergence” in a strategic management context by distinguishing the dimensions of convergence and analyzing the implications for the industry structure. Does convergence mean the need for closer cooperation between industries or does it imply substitution of products or services? Dealing with altered industry structures through mutual innovation, traditional frameworks have to be reevaluated and will be modified or extended in order to give direction for an adequate strategy.