Document de travail

Creating platforms by hosting rivals

Andrei Hagiu, Bruno Jullien et Julian Wright

Résumé

We explore conditions under which a multiproduct firm can profitably turn itself into a platform by "hosting rivals", i.e. by inviting rivals to sell products or services on top of its core product. Hosting eliminates the additional shopping costs to consumers of buying a specialist rival's competing version of the multiproduct firm's non-core product. On the one hand, this makes it easier for the rival to compete on the non-core product. On the other hand, hosting turns the rival from a pure competitor into a complementor: the value added by its product now helps raise consumer demand for the multi-product firm's core product. As a result, hosting can be both unilaterally profitable for the multi-product firm and jointly profitable for both firms.

Codes JEL

  • D4: Market Structure and Pricing
  • L1: Market Structure, Firm Strategy, and Market Performance
  • L5: Regulation and Industrial Policy

Remplacé par

Andrei Hagiu, Bruno Jullien et Julian Wright, « Creating platforms by hosting rivals », Management Science, 2019, à paraître.

Référence

Andrei Hagiu, Bruno Jullien et Julian Wright, « Creating platforms by hosting rivals », TSE Working Paper, n° 18-970, novembre 2018, révision mars 2019.

Voir aussi

Publié dans

TSE Working Paper, n° 18-970, novembre 2018, révision mars 2019