Valuation of Digital Platforms: Experimental Evidence for Google and Facebook

Bodo Herzog

IJFS, 2018, vol. 6, issue 4, 1-13

Abstract: This article investigates the fundamental value of digital platforms, such as Facebook and Google. Despite the transformative nature of digital technologies, it is challenging to value digital services, given that the usage is free of charge. Applying the methodology of discrete choice experiments, we estimated the value of digital free goods. For the first time in the literature, we obtained data for the willingness-to-pay and willingness-to-accept, together with socio-economic variables. The customer’s valuation of free digital services is on average, for Google, 121 € per week and Facebook, 28 €.

Keywords: digital platform; free goods; choice experiment; two-sided markets (search for similar items in EconPapers)
JEL-codes: F2 F3 F41 F42 G1 G2 G3 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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