Antecedents of Growth in Network Competition:

David P. McIntyre Antecedents of Growth in Network Competition: Quality or Quantity? (Under the direction of Dr. Richard A. Bettis) This research examines the impact of two potential antecedents of growth in hightechnology, network industries. The first antecedent, installed base, is traditionally framed as a key driver of growth in these settings. The second, product quality, is thought to have only random influences on growth. This work tests the influence of both of these variables on growth in the packaged application software industry, and proposes that their relative influence may be contingent upon the network intensity of a given market or segment. In turn, installed base and timing of product release are proposed to have a significant impact on quality. The sample for this study encompassed five segments of the packaged application software industry from 1986-1998, including word processing, spreadsheets, desktop publishing, CAD, and personal finance. Several results from the empirical analysis offer useful insights into the nature of network industries, and implications for strategic management in these domains. First, installed base size exhibits a negative relationship with growth that becomes more positive as size increases. Second, product quality is positively and significantly associated with installed base growth. Third, the impact of