Competition and Strategic Partnership between Intermediary Platforms in the Presence of Heterogeneous Technologies

Mantena, R and Saha, R L (2012) Competition and Strategic Partnership between Intermediary Platforms in the Presence of Heterogeneous Technologies. In: 2012 45th Hawaii International Conference on System Sciences.

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Should platform based market intermediaries collaborate with their competitors? If so, should they share their technologies, their member networks, or both? These are the questions we seek to answer using a simple two-sided network model where the members' utilities are driven by both network size and the level of technology provided by the platforms. Consistent with the literature, we find that these network markets are characterized by extremely asymmetric outcomes. Under open competition, the superior-technology platform completely dominates the market and, surprisingly, this extreme asymmetry persists even as the technology gap between the leading and the competing platforms vanishes. Our analysis on the possibility of strategic partnership reveals that platforms would not want to share technologies alone with rivals, however, sharing their networks, with or without side payments, can be Pareto optimal. The likelihood of partnership is influenced by platforms' relative strengths in technology and the cross-platform technology experience.

Affiliation: Indian School of Business
ISB Creiators:
ISB Creators
Saha, R L
Item Type: Conference or Workshop Item (Paper)
Additional Information: The research paper was published by the author with the affiliation of University of Rochester.
Uncontrolled Keywords: Groupware, Pareto optimisation, Strategic planning, Strategic partnership, intermediary platforms, Heterogeneous technologies, Market intermediaries, Member networks, Two sided network model, Network markets, Open competition, Superior technology platform, Technology gap, Pareto optimality, Monopoly, Google, Games, Advertising, Consumer electronics, Operating systems, Collaboration, Two-sided markets, Technology competition, Platform competition, Platform collaboration
Subjects: Information Systems
Depositing User: Ilayaraja M
Date Deposited: 16 Jun 2019 17:38
Last Modified: 16 Jun 2019 17:39
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