Product innovation rumors as forms of open innovation

Prior studies of open innovation have highlighted the effects of different flows of knowledge between firms and external partners-such as flows of software code, technical solutions, or new product ideas-and how firms face a “paradox of openness” about how open to be to external sources while also appropriating value. There are increasingly flows of more provisional knowledge as well, in the form of product innovation rumors exchanged within online technology blogs. Our study objective was to understand how product innovation rumors are used by firms as both inflows and outflows of provisional knowledge and their effect on the innovation process. Using interview data within a high-technology firm whose forthcoming products were the subject of rumor within technology blogs, we develop propositions regarding how inflows of product innovation rumors affect innovation decisions (while addressing concerns about appropriability and intrafirm knowledge flows) and how outflows from firms may affect stakeholders outside the firm (through selective revealing and influence of technology blog editors). Product innovation rumors in part address the paradox of openness by forming an informal means of open innovation alongside formal processes, and we suggest further research opportunities in this domain.