Profiting from enabling technologies?

How to profit from innovation has been an important question for both innovation scholars and practitioners over the years. It is certainly a relevant question for all types of technological innovation, including emerging ones. Teece's (1986) profiting from innovation (PFI) framework sets forth a theory of the relevant contingencies. However, Teece's framework focuses on technologies with applications in specific domains. We focus on the question of how to profit from enabling technologies: technologies that are applicable across multiple domains. We argue that capturing value in such circumstances is fundamentally different from profiting from less-enabling technologies and raises new issues with respect to the relevant business models and public policies. This paper's contribution is threefold. It formally revises and extends the original PFI framework to include the case of enabling technologies; it provides empirical evidence to support the distinction between profiting from enabling as compared to profiting from narrower "discrete" technologies; and it generates perspectives on the appropriate business models for these technologies and discusses related public-policy implications, in light of the fact that the share of the benefits the innovator can capture is likely to be even smaller for enabling than for discrete technologies.