The value of online user generated content in product development

An empirical study of 1287 software projects over 16 months reveals that online user- generated content (UGC) has positive effects on both the initiation and completion of product-development activities. Moreover, product adoption amplifies those positive effects. These results imply that (1) online UGC is useful for product development; (2) learning from online UGC facilitates product-development activities; and (3) product adoption moderates this learning effect, suggesting that users can shape future products through online UGC and adoption behavior. This study advances both the user innovation and open innovation research streams, and moves toward closing the gap between the two major streams in the distributed innovation paradigm.