From Peer Production to Productization: A Study of Socially Enabled Business Exchanges in Open Source Service Networks

Peer production phenomena such as open source software (OSS) have been posited as a viable alternative to traditional production models. However, community-based development often falls short of creating software “products” in the sense that consumers understand. Our research identifies an emerging business network archetype in the OSS sector, the open source service network (OSSN), which seeks to address the “productization” challenge. To do so, OSSNs must overcome the problems associated with exchanging resources between firms. We demonstrate that OSSNs overcome exchange problems by primarily relying on social, rather than legal, mechanisms; similar to the OSS communities from which they emerged. This is made possible because OSSNs use IT infrastructures that provide high visibility for primary value-creating activities. The research utilizes a multimethod theory-building approach, deriving a model from extant research, refining the model through qualitative case study analysis, and further refining the model through quantitative analysis of survey data. The paper reveals the manifestation of social mechanisms in OSSNs and how these are used for coordinating and safeguarding exchanges between firms. Specifically, we illustrate the primary importance of a shared macroculture (goals and norms) and collective sanctions for punishing firms who violate these goals/norms. Furthermore, our research highlights the interplay between digital and social networks within OSSNs, demonstrating that the use of social mechanisms is inherently dependent upon the underlying IT infrastructure.