This paper traces the evolution of the distributed innovation paradigm in order to explore the roles and strategic choices faced by the principal actors. The consumer electronics and ICT sectors are selected as the primary focus of the study as the separation of product design, development and manufacture is already well advanced, and as they exhibit a relatively high 'clockspeed'. Data is derived from case studies of products created via distributed innovation networks and derived from interviews with representatives of the four principle types of actor identified in the research framework: OEMs 1 , Technology Providers, Design Houses and Contract Manufacturers. A typology of OEMs is proposed, based on the degree of 'virtuality' exhibited by the firm's innovation process, which is in turn influenced by the firm's historical trajectory and degree of integration of product design activities. For each of the four types of actor, a dynamic picture emerges in which choice of business model is increasingly important. Managers should be aware that while distributed processes may provide opportunity for rapid innovation, this approach may not be optimal over time.

Keywords: Distributed innovation, value chain actors, value capture strategies