The document discusses the concept of open innovation and strategy based on an article by Chesbrough and Appleyard. It summarizes that open innovation involves pooling knowledge from various contributors who cannot exert exclusive rights over the innovations. This creates value in two ways but poses challenges to traditional business strategies reliant on ownership. The document also discusses implications for strategy, such as understanding how to balance value creation with value capture. An example of Linden Lab's Second Life business model shows how it facilitates open participation and value creation while still earning revenue.