User-led Innovation and the video game industry

In spite of the recent acknowledgements of “open source development” type of user-led innovation, our understanding is still limited as to its applicability and benefit. Particularly, from the viewpoint of firms making consumer goods, it remains unclear whether they can take advantage of peer-to-peer interaction and collaboration among consumers in the Internet era. Through an analysis of the video game industry, this article highlights its potential and limitations. The current hype of user-led innovation entails the risk of the concept’s being over-applied in terms of its applicability across industries and assumption of benefits. We argue that user-led innovation emerged out of not only technology-specific environment, but also culturally-specific context of industries. Our analysis shows that user-led innovation in its applications is likely to be constrained by the cultural context among other obstacles, thereby limiting its usefulness to a set of industries with particular characteristics. .