In this study, the authors shed light on the intricate and dynamic structure of modern mobile phone and AI-related industries — revealing how no single firm leads, yet innovation thrives. Digitally mediated modular ecosystems (MMEs), like those underlying smartphones, have evolved organically into multi-layered, interdependent systems. While modular platforms and value chains provide the structural backbone, innovation hinges on less modular modes of coordination — including deep partnerships and in-house capabilities. The most successful firms strike a delicate balance between fitting into the modular logic and pushing its boundaries.
The authors also reveal how thousands of functionally specific standards — many developed through voluntary engineering contributions — enable the integration of sub-ecosystems into global tech stacks. Heavy-handed state interventions risk disrupting this delicate equilibrium. Meanwhile, MMEs offer flexibility that helps latecomers survive export restrictions, enables ‘over-the-top’ innovation (e.g., WeChat, generative AI), and creates deeply embedded positions for firms like ARM, which are virtually irreplaceable.
Yet despite the global structure, the dominance of US firms is pronounced across nearly all but a few subsystems — memory, display, manufacturing, and assembly. Even so, the idea of a fully American-made mobile phone remains both infeasible and undesirable.
This event is co-organised with the Vienna Institute for International Economic Studies (wiiw) and the Research Centre International Economics (FIW).
The project leading to this webinar has received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No. 101031139. Any dissemination of the results of this event, reflect only the presenters' view. The European Commission is not responsible for any use that may be made of the information it contains.