6533b821fe1ef96bd127b9c9
RESEARCH PRODUCT
The impact of scale effects on the prevailing internet-based banking model in the US
Alexandre MomparlerJosé María BallesterFrancisco Climentsubject
Internetbusiness.industryStrategy and ManagementCompetitor analysisMonetary economicsBusiness modelCompetitive advantageEconomies of scaleFinancesHuman resource managementEconomicsThe InternetScale effectsBusiness and International ManagementMarketingbusinessFinancial servicesdescription
Internet-based banks use a technology-intensive production process that may benefit from scale effects as they grow larger. This article analyzes whether the predominant Internet-primary bank in the USA generates technology-based economies of scale in the period 2002–2010. There is evidence of both favorable and adverse technology-based scale effects. As the leading Internet-primary bank gets larger, the financial performance gap with traditional banks shrinks while some of its critical competitive advantages wear down. The results suggest that unless the prevailing Internet-primary bank preserves the distinctive advantages of the Internet-based business model as it improves financial performance, it might end up converging with its branching competitors.
| year | journal | country | edition | language |
|---|---|---|---|---|
| 2011-11-27 |