Complementor participation in platforms: Evidence from the 7th and 8th Generations of Video Game Consoles

This paper analyses how the factors breadth of content offerings, boundary resources, and exclusive content explain complementor participation in plat-form-based ecosystems, in the context of video game consoles. Fixed effects regressions on a panel com-prising two generations of consoles across six plat-forms show that the breadth of content offerings posi-tively affects complementor participation. We find that breadth of content offerings, but not boundary resources and exclusive content, are positively related to complementor participation. When studied in one model, breadth of content offerings dominates the relationship. Our results show how complementor ecosystems can be orchestrated to proliferate a varie-ty of complementary product offerings

How Licensing Resolves Hold-Up: Evidence from a Dynamic Panel Data Model with Unobserved Heterogeneity

In a patent thicket licensing provides a mechanism to either avoid or resolve hold-up. Firms' R&D incentives will differ depending on how licensing is used. In this paper we study the choice between ex ante licensing to avoid hold-up and ex post licensing to resolve it. Building on a theoretical model of a patent portfolio race, firms' choices of licensing contracts are modelled. We derive several hypotheses from the model and find support for these using data from the semiconductor industry. The empirical results show that firms' relationships in product markets and technology space jointly determine the type of licensing contract chosen. Implications for the regulation of licensing are discussed. We estimate a dynamic panel data model with unobserved heterogeneity and a lagged dependent variable. A method suggested by Wooldridge (2005) is employed to estimate a random effects probit model using conditional maximum likelihood

Developing Competences Designed to Create Customer Value

This paper focuses on how small, specialized suppliers can gain competitive advantage by acting as a potential for their scale intensive producing customers in achieving competitive advantage. Of special interest is how a shared under-standing of ‘value’ for the customer is obtained, transferred and implemented in the specialized supplier’s production of process equipment. The study draws on theory on networks and specialized suppliers as well as interviews with key in-formants in three specialized supplier companies for the aluminum industry. An important finding is that the constellation of the specialized supplier’s network changes as the project moves from planning to production. With these changes, the role of specialized suppliers in the value creation process also changes. It seems to be an important competence for small, specialized supplier to be able to draw on and manage this network in their value creation process.

Complementor dedication in platform ecosystems: rule adequacy and the moderating role of flexible and benevolent practices

Dedicated complementors are devoted, faithful, and willing to invest in their partnership with a platform owner. Since such complementors promise continuous value co-creation, complementor dedication is an essential objective of platform governance. However, as dedicated complementors also increase their vulnerability vis-à-vis the platform owner, platform governance needs to strike a balance between satisfying global ecosystem needs and the local partnership needs. To understand this challenge better, our study develops six hypotheses on how two fundamental governance mechanisms – i.e., rules and the way in which these rules are practised – independently and symbiotically drive complementor dedication. We test these hypotheses using survey data from 181 complementors. Our findings show that complementors become more dedicated to a platform owner, the more adequate they perceive the rules to be. Furthermore, our findings suggest two sensible strategies to actualise the potential of adequate rules. Platform owners should either refrain entirely from practising rules with situational flexibility and benevolence, thereby achieving moderate complementor dedication. Alternatively, they should practice rules with both flexibility and benevolence at the same time, thereby maximising complementor dedication. Our findings contribute to the literature on platform governance and broader governance literature

The Competition Effect of Decentralized Platforms: An Analytical Model

Envelopment angst and concerns about the exploitative appropriation of data network effects can lead to fragmented platform markets. In this paper, we investigate if this fragmentation can be mended with decentralized platform architectures. Abstracting from an exemplary case in the mobility-as-a-service sector, we model a competitive two-platform market with a centralized platform and decentralized alternative. We find that in markets with high envelopment costs, the co-existence of these platforms leads to market segmentation: Complementors with low market power join the centralized platform, while complementors with high market power join the decentralized platform. Furthermore, the existence of a decentralized alternative can increase welfare. Lastly, by considering data control aspects, we demonstrate the effect of favorable platform design on complementor decision-making

Leveraging Ambidexterity in a Digital Platform Ecosystem: Insights from a Complementor’s Perspective

This case study explores ambidextrous practices of a complementor firm within a Microsoft-owned digital platform ecosystem (DPE). We draw on organizational ambidexterity and social mechanisms as lenses to analyze how a complementor deals with paradoxical practices of exploration and exploitation in the context of a DPE. By identifying deep structures and surface structures and their related social mechanisms we shed light on the role of ambidextrous complementors in a DPE. Our analysis implies that the identified social mechanisms illustrate how the complementor creates new ideas with other DPE actors to nurture capability development (exploration) and how these ideas are transformed into practice (exploitation). In addition, our findings imply that the complementor’s support of a platform contributes to an increased commitment to the platform owner

Compatibility promotion for standard development within shared platforms:A rising tide does not lift all boats

Selective promotion entails the exploitation of resources offered by individual complementors to improve a proprietary platform’s competitive position. However, as governance decisions to endorse a particular complementor are made unilaterally, such promotion is less suitable for shared platforms that are ultimately owned and managed by an ecosystem of heterogeneous, autonomous complementors. We explore compatibility promotion, which involves screening a shared stock of infrastructural resources and making a choice as to which complementor to promote in light of the capabilities the platform seeks to develop. Based on a longitudinal study of a shared platform that evolved around a new technology standard in the Swedish road haulage industry, we explicate how elevating one complementor over others unsettled the governance of the platform and denied the promoted complementors the opportunity to generate the kind of value that their elevated status implicitly promised. This made the platform better off at the expense of the promoted complementor. Our surprising insight lets us theorize why compatibility promotion in shared platforms renders outcomes opposite to those of selective promotion in proprietary platforms.</p

Competing with Superstars: Does Exclusive Third-Party Content Discourage Complementary Innovation?

We study how the introduction of exclusive third-party applications affects competing complementors’ innovation strategies in platform ecosystems. In this study, we exploit the exclusive entry of Super Mario Run into the complementary app market of Apple’s iOS App Store in Autumn 2016 as a quasi-experiment. We collect monthly time-series data throughout the observation period. We find that complementors show heterogeneous innovation behavior after the entry. First, we demonstrate that affected complementors with a similar market position as the entrant follow a competition strategy for update releases in the affected niche market. Complementors who do not hold a similar market position reduce the number of updates for existing products in the affected niche market following a differentiation strategy. Finally, independent of the complementor’s market position, affected complementors follow a differentiation strategy for new app releases, increasing the number of new app releases in other categories