This paper was presented at The 6th ISPIM Innovation Symposium Innovation in the Asian

Century, in Melbourne, Australia on 8-11 December 2013. The publication is available to ISPIM
members at www.ispim.org.

Transmediality as collaborative innovation

Kati Jrvi*
Lappeenranta University of Technology
School of Business
Skinnarilankatu 34, 53850 Lappeenranta, Finland
E-mail: jarvi@lut.fi

Liisa-Maija Sainio
Lappeenranta University of Technology
School of Business
Skinnarilankatu 34, 53850 Lappeenranta, Finland
E-mail: liisa-maija.sainio@lut.fi

* Corresponding author

Abstract: This study explores collaborative innovation with a case study on

transmediality in game development. In open and dynamic industries such as
the game industry, innovation attributes are highly distributed, requiring
organization to collaborate in their innovation activities. Whereas literature on
the producer or vertically integrated model of innovation has been quite
extensive in discussing the various aspects of exploitative innovation (based on
combining existing innovation attributes firm-internally) and explorative
innovation (based on creating new innovation attributes firm-internally), the
differences between combining existing versus creating new innovation
attributes in collaborative innovation has not yet been examined. The results
suggest that collaborative innovation can be based on sharing and combining
existing innovation attributes, such as knowledge, components or complements
but further, collaborative innovation can engage organizations in co-creating
new innovation attributes. Distinguishing between these two different types and
discussing their related benefits and challenges enhances our understanding on
collaborative innovation.

Keywords: Co-creation; collaborative innovation; innovation attributes; inter-

organizational relationships; transmediality

1 Introduction

Understanding collaborative innovation is a central theme in current innovation

management scholarship. Especially in industries which are open and dynamic by their
nature, resources are highly distributed, posing a tremendous challenge for single
organizations to consistently develop or acquire the best innovations (Davis &
Eisenhardt, 2011). Previous literature on collaborative or distributed innovation has
primarily emphasized the structural antecedents of inter-organizational relationships for
combining knowledge, technologies, and other resources and innovations (Davis &

1
 This paper was presented at The 6th ISPIM Innovation Symposium Innovation in the Asian
Century, in Melbourne, Australia on 8-11 December 2013. The publication is available to ISPIM
members at www.ispim.org.

Eisenhardt, 2011), including for example efficient governance (OMahony & Ferraro,
2007), alliance capability (Kale et al., 2002) and trust (Gulati, 1995). However, the
current accounts have been criticized for neglecting the performance implications and
processes that enable multi-actor collaboration and collaborative innovation (Davis &
Eisenhardt, 2011). Further, literature on collaborative or distributed innovation has been
fairly silent on the types of innovation that could be sought with different types of
collaborations. Whereas literature on the producer or vertically integrated model of
innovation has been quite extensive in discussing the various aspects of exploitative
innovation (based on combining existing knowledge and resources firm-internally) and
explorative innovation (based on creating new knowledge and resources firm-internally),
the differences between combining existing versus creating new innovation attributes in
collaborative innovation has not yet been examined.
We respond to this call by studying how Finnish game developers engage in
collaborative innovation. Our case study on transmediality as collaborative innovation
focuses especially on the development of games. In general, in the process of
transmediality, integral elements of product, service or experience are dispersed across
multiple delivery channels. An example of transmediality is the story of Lara Croft,
originally the protagonist of video game series Tomb Raider, has unfolded across
multiple media, such in comics and in movies. The purpose of this dispersion is to create
value to the customer with a unified and coordinated entertainment experience.
This study adopts the viewpoint of innovation management to the topic in question,
however, we acknowledge that the phenomenon of transmediality is connected to
branding literature in the field of marketing, since the phenomenon could also be seen as
a case of co-branding (see i.e., Volckner & Sattler, 2006) or as a special case of brand
extension (Park et al., 1996). From the perspective of marketing communication,
transmediality could also be considered as a special case of product placement (see i.e.,
Hang & Auty, 2011). However, we argue that to look at transmediality as collaborative
innovation only through the lens of branding mechanisms would ignore the innovation
attributes related to the collaborative innovation.
This study offers two contributions to enhance the understanding on collaborative
innovation. Firstly, a multi-faceted, contextual illustration of the transmediality as
collaborative innovation is provided and first steps to examine these types of
collaborative processes are made. Secondly, we distinguish between the two different
types of collaborative innovation where the other type is based on sharing and combining
existing innovation attributes (i.e., knowledge, components and complements) and the
other is based on co-creating existing innovation attributes. Distinguishing between these
two different types and discussing their related benefits and challenges provides the first
steps to examine the differences between combining existing versus creating new
innovation attributes in collaborative innovation.

2 Theoretical background

Firms are increasingly opening up their value creation processes through the use of
various types of collaboration for innovation (Baldwin & von Hippel, 2011; Chesbrough,
2003). Especially in computer, biotechnology, and microelectronic industries, where
knowledge is complex, growing, and widely diffused, the locus of innovation extends
beyond an individual firm (Fjeldstad et al., 2012; Powell et al., 1996). This represents a

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paradigm shift from the producer or the vertically integrated model of innovation to a
distributed or collaborative model of innovation (Baldwin & von Hippel, 2011; Bogers &
West, 2012).
The producer model is built upon the premise that innovation is being created and
commercialized within a single firm (Bogers & West, 2012); it assumes that the most
important innovations originate from producers and the innovations are then supplied to
consumers via good and services (Baldwin & von Hippel, 2011). The domain of
distributed or collaborative innovation includes multiple perspectives, which can be
differentiated based on their view of the locus and the motives for innovation. Further,
perspectives, such as user innovation, open innovation, cumulative innovation,
communities, social production, and co-creation can be differentiated based on nature of
innovation, its commercialization process and its relevance for firms. However, all are
built upon the assumption that commercially valuable innovation attributes, leading to
distributed innovation creation and commercialization, are located outside the firm
boundaries.
Value creation is the raison d'tre of innovation collaboration. In general, value
creation refers to mechanisms related to innovating, producing, and delivering products
or services to markets, and value appropriation refers to mechanisms focused on
extracting profits from the marketplace (Lepak et al., 2007). More specifically in the
context of collaborative innovation (i.e., Adner & Kapoor, 2010), value creation has been
portrayed as a collective activity among the collaborating actors, aiming to create value
for the customer with new or improved offerings (Ritala & Hurmelinna-Laukkanen,
2009). From the economics perspective, value is defined as the eventual willingness-to-
pay for a certain product from the viewpoint of the end customer (Brandenburger &
Stuart, 1996; see also Bowman & Ambrosini, 2000). Thus, in the end customers define
what is economically valuable or not, and the value creation efforts are eventually
directed towards this goal.
Value appropriation, on the other hand, has been defined as the share that an
individual actor is able to capture from the value created in collaborative innovation
activities (Ritala & Hurmelinna-Laukkanen, 2009). Both of these processes are
fundamental parts of the logic of collaborative innovation without value creation, there
is nothing to appropriate and without appropriable value in sight, there are no incentives
to create the value in the first place. Aligned with this thinking, it has been suggested that
in the inter-organizational level, value creation processes are often collective by nature,
while value appropriation processes are fundamentally organizational-level processes
(Adegbesan & Higgins, 2010; Ritala & Hurmelinna-Laukkanen, 2009).
Such collaborations are potentially very beneficial for the firms competitiveness and
growth, since they allow for collective creation of value as well as its eventual
appropriation by individual actors. On the other hand challenges rise in this context from
the vast number of different actors, their interconnections, and the potential asymmetry in
the actors motivations, goals, and strategies. Further, organizations are currently missing
ways to evaluate, measure, and pragmatically demonstrate the benefits, productivity
impacts and related externalities that follow from involving new actors dynamically in its
innovation activities.
 This paper was presented at The 6th ISPIM Innovation Symposium Innovation in the Asian
Century, in Melbourne, Australia on 8-11 December 2013. The publication is available to ISPIM
members at www.ispim.org.

2.1 Structures of collaborative innovation

Different inter-organizational relationship structures exist for collaborative innovation. In
a bilateral innovation alliance, two firms, often a buyer and a supplier, work together to
accomplish a joint innovation goal. The relationship between the independent firms is
direct and bilateral and the organizations usually create value by combining
complementary and supplementary resources, recognized mostly ex ante to the
relationship. The outcomes of the bilateral innovation alliance are determined through the
joint goals of the partners.
In a multilateral innovation alliance, multiple firms with joint goals in R&D and
innovation, including vertical and/or horizontal actors, are engaged in innovation
activities. Similar to bilateral innovation alliance, the organizations in a multilateral
innovation alliance usually create value by combining complementary and supplementary
resources, recognized mostly ex ante to the relationships. The outcomes of the
multilateral innovation alliance are determined in a multi-actor environment with (at
least) partially converging goals.
In an innovation network, vertical and horizontal actors with individual and joint
goals in R&D and innovation come together. An innovation network is a system with
independent and interdependent actors within a more or less dense structure. The
innovation network is dynamic by its nature and the roles and motives of the actors
change over time and new actors join while other leave. Value is created by combining
complementary and supplementary resources, however, many of which are not
necessarily known ex ante. The outcomes of the innovation network are partially open-
ended and determined in a network environment with both converging and conflicting
goals.

2.2 Innovation attributes for collaborative innovation

Previous literature on innovation attributes for collaborative innovation pinpoints mainly
important structural antecedents, such as efficient governance, alliance capability and
trust, of successfully combining knowledge, technologies and other resources across
organizational boundaries (Davis & Eisenhardt, 2011). Commercially valuable
innovation attributes include for example market and technological knowledge,
components, and complements (Bogers & West, 2012). Market and technological
knowledge can be obtained for example from basic scientific research or from customers
(market needs and demand information). Components as innovation attributes are
supplied usually by external innovators selling their products to the focal firm. Further,
supplier innovations related to materials, components, and equipment represent
components as innovation attributes. Complements are also usually supplied by external
innovators but provided directly to the end users. Such innovation attributes usually
improve the value of the focal firms products or services, leading to an improved ability
to appropriate value from its innovations (Bogers & West, 2012).

3 Transmediality

Transmediality is a process where integral elements of product, service or experience are

dispersed across multiple delivery channels (Jenkins, 2007). The purpose of this

4
dispersion is to create value to the customer with a unified and coordinated entertainment
experience. In the cultural and creative industries the characters of Lara Croft and Max
Payne represent well-known examples of transmediality. Lara Croft, originally the
protagonist of video game series Tomb Raider has also appeared in comics and in
movies. Max Payne was the main character of both the third person shooter game and
movie by the same name. Beyond these types of examples which aim mainly at extended
the product life cycle of the particular product, in this case the game by promoting it in
another media, more versatile and strategic uses of transmediality can be found. Icelandic
CCP Games has developed two video games, EVE Online and Dust 154, where players
of Dust 154 can compete for planets in the universe of EVE Online, meaning that both
games impact each other. Further, both games share the same currency. Defiance is an
interconnected video game and TV show. The events in both the game and the TV show
depend on each other and the TV show will feature some player's characters as extras.
Further, Supercell and GungHo Entertainment joined forces to introduce exclusive in-
game features for their leading titles. One might stumble upon a dungeon in Puzzle &
Dragons that would be themed with Clash of Clans decorations and monsters.
The fundamental question in transmediality is how to collaboratively develop content
that would play well across media. Transmediality and the accompanying different media
offer organizations opportunities to for example attract different market niches, but much
of transmediality has mainly focused on the adaptation of content via licensing and
franchising rather than actual co-creation in collaborative innovation.

4 Methodology

A review of the literature was followed by an inductive and explanatory single case
study. The empirical context of this study is the Finnish game industry, which is
appropriate for the following reasons. Firstly, the industry is very open by its nature and
collaborations are plentiful and essential. Secondly, even though there is variance in the
size and age of the game companies, even the largest ones demonstrate significant
entrepreneurial spirit and openness. Thirdly, mergers and acquisitions are atypical to the
game industry, enhancing the importance of inter-organizational collaboration.
The data was collected with seven semi-structured interviews. All of the firms are
headquartered in Finland, but in their nature, they are born globals. This enhances the
generalizability of our research. During the interview, the informants were first asked to
provide background information about their company. Then, we asked the informants to
describe their innovation or new product development process. Then, we asked the
informants to describe the processes of transmediality: how elements of the game
experience are dispersed across multiple delivery channels, how such dispersion creates
value for the customer, and what business benefits can be reaped from transmedia
innovation and value creation process.
The interviews were conducted in May 2013. The duration of the interviews varied
between 48 minutes and 95 minutes. The interviews were recorded and transcribed
verbatim. In total, 91 pages of transcribed interview material were analyzed with content
analysis method and with the help of NVivo 9 software.
 This paper was presented at The 6th ISPIM Innovation Symposium Innovation in the Asian
Century, in Melbourne, Australia on 8-11 December 2013. The publication is available to ISPIM
members at www.ispim.org.

5 Results and conclusions

The results of this study suggest that collaborative innovation can be based either on
sharing and combining innovation attributes or co-creating innovation attributes. Table 1
defines the two different types of collaborative innovations, gives examples of the both
types of collaborative innovations in game development, and summarizes the related
benefits and challenges.

Table 1 Types of collaborative innovation

Type of Examples in
collaborative Definition game Benefits Challenges
innovation development
Collaborative Shared and Two or more Achieving a Sharing an
innovation combined games a sharing critical mass attribute which is
based on innovation a currency: EVE the basis of
sharing and attributes can Online and competitive
combining include for DUST 154. advantage
innovation example sharing
attributes and combining A game Entering a new Damaging brand
knowledge, combining geographical equity
components, or different brands: market
complements (i.e., Kingdom Hearts
licensing or with figures
franchising) in developed by
order to create a Disney and
shared product or figures from
service attribute. Final Fantasy

Collaborative Co-created Games are Resource Time related

innovation innovation sharing a recycling challenges due to
based on co- attributes include character or a differences
creating jointly created persistent player between
innovation knowledge, profile organizations in
attributes components or Fastening the firm-internal
complements in new product processes for
order to create a development innovation
shared product or
service attribute.

Collaborative innovation based on sharing and combining innovation attributes utilizes

the existing knowledge, components or complements of the partners. On its most basic
form, collaborative innovation based on sharing and combining innovation attributes
resembles branding mechanisms such as co-branding, brand extension, and product
placement. In such instances, existing products or services are utilized to improve
products, services or experiences for the customer. Co-branding, brand extension, and
product placement enable organizations to cross-promote their products or services and
improve their customer retention.
A more advanced form of collaborative innovation based on sharing and combining
innovation attributes engages organizations to innovation activities which purpose is to
create a shared product or service attribute between two or more products or services. A

6
shared product or service attribute can be for example a currency between two different
games such as the shared currency between EVE Online and DUST 154. Such
collaborative innovation with sharing and combining existing innovation attributes can
enable organizations to achieve a critical mass for their products or services or to enter a
new geographical market.
Collaborative innovation based on co-creating innovation attributes goes beyond
simply sharing and combining existing innovation attributes (for example knowledge,
components or complements) to co-creating new knowledge, components or
complements. In the context of game development, a shared product or service attribute
can be for example a shared character between two or more games or a persistent player
profile between two or more games. Collaborative innovation based on co-creating
innovation attributes can enable organizations to recycle existing resources and fasten
the new product or service development.
Both types of collaborative innovation pose challenges for the involved organizations.
The collaborative innovation based on sharing and combining innovation attributes to
create new product or service attributes (such as a shared currency between two or more
games) can expose organizations to lose control of such an attribute which is basis for
their competitive advantage. Further, the management of IP rights and brands becomes of
importance as sharing innovation attributes can damage the brand equity if the innovation
attribute, the brand (for example a figure in a game), is implemented in the innovation
outcome in such a way that would diminish the brand value and the usability of the
innovation attribute in the future.
Collaborative innovation based on co-creation of innovation attributes can create a
time related challenge for the involved organizations. Whereas collaborative innovation
based on sharing and combining innovation attributes enables organizations to develop
the innovation attributes they wish to share at their own schedule, collaborative
innovation based on co-creation of innovation attributes seems to require organizations to
work simultaneously. Challenges in this sense can arise from difference between
organizations in firm-internal processes for innovation. Organizations have different
decision rules for managing new product development, distinct product market
objectives, and distinct new product development process schedules.
Challenges related to provision of customer experience may eventually diminish the
value created. These challenges include the possibility of unintentionally fragmenting the
customer experience by spreading it across too many media. Further, the customer
experience might be fragmented and the value creation might diminish if the customer
feels that transmediality requires extra efforts from the customer (compared to single
media) or if the outcome (i.e., the game) of the collaborative innovation is not
recognizable as consisting of individual but inter-connected elements.
The results of the study are especially relevant in the cultural and creative industries
but other, more traditional industries benefit from the results as well. Value creation in
collaborative innovation via transmediality does not take place only in virtual worlds
(i.e., in games). The virtual world borrows much from the real world and real world
product manufacturers, such as for example car manufacturers, can also reap the
aforementioned benefits of collaborative innovation based either on sharing and
combining innovation attributes and co-creating new innovation attributes as well.
 This paper was presented at The 6th ISPIM Innovation Symposium Innovation in the Asian
Century, in Melbourne, Australia on 8-11 December 2013. The publication is available to ISPIM
members at www.ispim.org.

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