Business Models for Online Communities: The Case of the Virtual Worlds Industry in China

Beyond e-business models: the road to virtual worlds

“…Many authors [17,26,40,48,56,88] have emphasized the nature of the interaction enabled by VWs, which is claimed to deliver more engaging and intense experiences to final users. Therefore, it seems valuable to use the engagement generated by a VW to commit users on the business model of the firm.…”

“…As a consequence, VWs embody the same advantages as business models based on communities, for instance in terms of learning processes [56] or the production and sharing of digital content [48], and at the same time, they offer firms a powerful platform to interact with. • VWs create a system of micropayment: the existence of a marketplace and a virtual currency makes it possible to create an easy way to implement a micropayment system [76], which is the basis for some sort of premium services, like the Freemium business model [70].…”

“…Therefore, the goal of this work is to create an analytical framework able to highlight the main drivers of potential value which are not usually considered by business models. That is to say, the attention is on those sources of value that companies fail to explain, due to the disproportionate attention given to short-term financial flows [48].…”

“…The intensity of the phenomenon has caught the attention of scholars, practitioners and companies. Many authors [36,48,62] have hypothesized that the rise and growth of VWs resembled the Internet in the nineties, from a sophisticated application for computer fanatics to a vital instrument of everyday life. At the same time, it is evident that VWs posed different challenges compared to any other IT application.…”

“…The problem is twofold: to recognize new, previously untapped sources of value; and to find how they yield value for the firm. Such a problem has been studied for community-based business models, in which the benefits granted by increased coordination and collaboration translate into cost savings and increased revenues only in the long-term [46]; that is to say, the business model factors that affect a firm's success in its early stages change at a more established stage [48]. As a result, the ability to drive conversion and participation, as well as the capability to integrate customers in companies' value chains, is crucial [34,85].…”