The Emergence of Regional Capabilities in New Technologies

This paper presents an alternative viewpoint of capabilities creation that focuses on the initial events in an industry. It uses the brief history of the mobile Internet to describe this viewpoint. NIT DoCoMo was the first company to create a critical mass of users and thus enable Japanese firms to begin building a variety of new capabilities. Other service providers have responded to i-mode's success in different ways depending on their perceptions of both coordination costs and potential revenues. These different responses have caused growth differences to emerge between Japan, Korea, and the rest of the world where a market failure may exist in most of the latter countries and thus may require government intervention to solve the startup problem.