Chinese Internet Firm Emerging: Imitation to Innovation Strategy Modeling

We revised Kauffman's NK model and try to explain the imitation behavior in among Chinese small businesses (Internet Market). A comparison among Baidu, Naver(Korea), Google and Yahoo performance on China Market and on international market showed that earlier international entrant cannot take advantages from their technology innovation as easy as those in traditional industry . Even though Chinese firms simply imitate the operation strategies at the very beginning, their vision are different from international company and can fit Chinese market better. The aim of this paper is trying to explain why some imitation strategies are successful while others meet the barrier of imitation by using Kauffman's NK model. Further more, we are trying to apply it as a universal rule to all imitation behavior. This rule can not only explain what happened in internet firms but also could expect to help other industries' failure in local market.