Electronic Marketplaces in Hong Kong's Trading Industry

Electronic marketplaces are important because of their potential to change industry structure, for example, by eliminating or altering the role of traditional intermediaries, leading to consolidation of fragmented industries or fragmentation of consolidated ones. Not solely a western phenomenon, there has been considerable electronic marketplace activity in Asia. Because supply chains in Asia are more fragmented than those in the US, many observers expect greater potential for electronic marketplace benefits, and hence adoption and impacts, in Asia. Still in their startup phase, it is too soon to expect to see evidence of indu stry structure change attributable to electronic marketplaces— such as declining prices for goods, reduction in the number of trading firms through bankruptcies or mergers and acquisitions, or systematic changes in the ways buyers conduct international sourcing. However, it is not too soon to start trying to understand the ways in which industry structure might change by looking at what the electronic marketplaces are trying to do. In particular, we are concerned with three theoretically motivated issues: 1) how well Asian marketplaces match theoretical characteristics believed likely to lead to changes in industry structure, 2) the electronic marketplaces’ avowed strategic intents, and 3) their resources for success.