Page - (000280) - in Knowledge and Networks

277 nance. Members undertake to meet the expectations in the network, which are based on formal, contractual rules and standards and on established and collectively shared conventions. Particular importance is attached to the conventions. A member cannot just opportunistically use the knowledge of other members against their will and for his or her own purposes without violating the convention and having to fear sanctions. Violating a relationship of trust in networks implies far greater conse- quences than simply the disapproval of the damaged partner. If joint associated third parties find out about A’s opportunistic behavior with B, then B as well as all of the other partners lose their trust in A (Glückler, 2001). Even though conventions have no legal character, their violation entails the risk of being shunned by the commu- nity or even excluded from it (Weber, 1922/1978). Hence, interfirm networks offer a suitable backdrop for cooperative learning in which practices of unfriendly imita- tion are not only illegitimate but effectively sanctionable. Colocated Network Organization The third context of geographic organization is the locally organized network. It includes features of both learning processes, that is, friendly and unfriendly oppor- tunities for imitation. Outside the strategic alliances established in the network, the physical proximity of local companies makes for unplanned personal contact (Rallet & Torre, 1999) and many other forms of mutual observation, often dubbed local buzz (Bathelt et al., 2004). The simultaneity of geographic proximity and coopera- tive relationships allows both friendly and unfriendly imitation, albeit in the context of a network based on conventions and rules, which sanctions unfriendly imitation more strongly than in a geographic cluster. Misbehavior can thus be identified and sanctioned with relative ease. Locally organized networks constitute a special type of organized network. They link the advantages of physical proximity with the advantages of organized cooperation in developing and disseminating innovations. The following empirical case study on a network addresses the central issue of colo- cated network organizations: the perception and regulation of the diametric opposi- tion that results in locally organized networks when the opportunities for unfriendly imitation benefit from physical proximity and when opportunities for friendly imita- tion benefit from cooperation. The Comra.de Network Case Study Comra.de: Ideal Type of Local Interfirm Network Comra.de is an organized network of 25 technology SMEs that offer solutions and services for e-commerce and the new media market. The network was established in response to the crisis at SellSoft.1 Sellsoft had held a leading market position in 1 SellSoft is a pseudonym for a large technology company on the new media market. 13 Connectivity in Contiguity