ARE PUBLISHERS READY FOR TOMORROW? PUBLISHERS' CAPABILITIES AND ONLINE INNOVATIONS

In order to cope with technological change, publishing companies need to effectively combine their capabilities and use them to support the development of new and existing products. In this paper, we explore the relationship between the market and technology capabilities of publishing companies and their online innovations. Our comparative case study focuses on four cases representing newspaper and magazine publishers. The case companies seem stronger in market than in technology capabilities. We also note an apparent tendency to build on the strongest capability area and to focus on leveraging those capabilities rather than taking a risk and experimenting in an area in which they are relatively weaker. Further, it seems that publishers have been able to leverage their market capabilities through online experimentation, but have not been able to develop their technological capabilities in the same manner. From the scientific perspective, this study makes two main contributions. Firstly, the empirical in-depth investigation of the capability portfolios of the case firms complements the emerging work on innovation-related capabilities. Secondly, the study adds to the literature on media management in enhancing understanding of the online-related capabilities that are required in publishing companies, and the related development patterns. Our study suggests that experimenting online and producing innovations requiring new types of internal market-related processes and practices is an efficient strategy to develop one's current market capabilities online.