The difference between Japan s keiretsu and a virtual alliance is that a virtual enterprise is used for more strategic purposes and the roles of the participants are more tailored. An illustration of a virtual alliance from the past would be the U.S. and European formed cartels. These cartels were created for the main purpose of suppressing the competition. The networked alliances of virtual enterprises gave U.S. based companies the ability to develop relationships with global partners to keep informed on external developments. Linking with various companies in different markets may help a company spread it s cost or expand it s access to skills and assets across many nations.
Some companies can also overcome regulatory barriers through the formation of aligned groups.
Alliances can also help market share contending companies promote their technology by adopting the technology and persuading more businesses to use their design. Networking allows specialists in each field to exploit new opportunities much faster. For example, the multimedia industry of merging computer technology with telecommunication, video and audio technologies. Virtual organizations can serve as catalysts to the development of industry directions and standards in ways that fully integrated organizations cannot. Take for example, Ameritech s alliances in their multimedia strategy.