Motivation and strategy: MNCs׳ embeddedness in China׳s standardization based innovation

• We develop a conceptual framework of MNC׳s motivation and strategy in China׳s standardization.
• We find that MNCs choose proactive or reactive embedding strategies in China׳s home-grown standard. The different strategies are influenced by the benefits and risks around the standards.
• The increasingly internationalized adoption of China׳s standard mitigates MNCs׳ risks by enlarging domestic 4G standard׳s adoption to more countries.
• China need to adopt more open strategies towards MNCs׳ embeddedness to internationalize China׳s standard.

This paper aims to understand why MNCs choose different embedding strategies in standardization based innovation, and how MNCs׳ competitive landscapes evolve alongside the transition of indigenous innovation in China. Using the multiple case study approach based on the interviews and archival data about China׳s mobile standards, we find that MNCs may choose to proactively or reactively embed in China׳s business and institutional systems by aligning their interests with the standard-based indigenous innovation strategy. Although there are high risks in China׳s standardization, MNCs cannot ignore the huge benefits of China׳s mobile market, and may join in this standardization process when they are ensured the government support would sustain.