Abstract
Digital transformation is reshaping competitive dynamics by enabling cross-industry convergence and accelerating market entry into digitally intensive domains. This chapter examines how firms navigate digital transformation when entering the video streaming ecosystem, focusing on the interaction between industry relatedness and strategic orientation. We develop a configurational framework that integrates these two dimensions and propose a 2×2 typology of transformation pathways: Synergistic Innovators, Legacy Anchors, Boundary Breakers, and Opportunity Seekers. Each configuration reflects distinct trade-offs in capability deployment, learning modes, and scaling trajectories within digital ecosystems. Drawing on patent mapping and case studies of Disney, Sony, Amazon, and Peloton, we illustrate how firms with varying degrees of relatedness and differing orientations pursue viable but divergent strategies for digital entry and growth. Our findings highlight that digital transformation is not solely driven by technological intensity but by the alignment between existing capabilities and strategic direction. High relatedness can both enable rapid adaptation and create inertia, while technology- and market-driven orientations entail different risks under uncertainty. Consistent with equifinality, multiple pathways to successful transformation exist. We conclude that firms achieving alignment between industry relatedness and strategic orientation are better positioned to scale and sustain competitive advantage in evolving digital ecosystems.