The Battle of the Smart Cards in the Netherlands in 2002

Published 01 Jan 2003
Reference 5134
Topic Strategy
Region Europe
Summary

Case Writers: Joris BEERENS and Gijs de ROOIJ The case describes the introduction of smart cards in the Netherlands from 1995 till 2002. It discusses the early stage when there were two rival platforms, Chipper and Chipknip, the migration to the Chipknip platform, the relaunch in 2001, and the early take-off in 2002. It also describes the technology of smart cards, the supply chain and the upcoming changes in payment systems in 2002.

Teaching objectives

The case allows a discussion of the difficulties in launching a product with network externalities when there are rival platforms with neither platform having a decisive lead. One can discuss the launch process, the economics of pre-emption advantages, the tactics to get to critical mass, and the competitive interactions. The discussion of the various payment systems also allows an analysis of the value propositions of each product.

Keywords
  • PAYMENT CARDS
  • AR2003
  • AR0304
  • RD0104
  • NETWORK EXTERNALITIES
  • CRITICAL MASS
  • PRODUCT ADOPTION
  • WINNER TAKE-ALL COMPETITION
  • STANDARDS BATTLES
  • PRODUCT STANDARDS
  • SMART CARDS
  • European Competitiveness
  • Europe