When "more" is not better

Carmelo Cennamo () and Juan Santaló ()
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Carmelo Cennamo: Instituto de Empresa
Juan Santaló: Instituto de Empresa
Authors registered in the RePEc Author Service: Juan Santalo

Working Papers Economia from Instituto de Empresa, Area of Economic Environment

Abstract: This article examines the value-creation capacity of intra-platform competition (IPC) and exclusivity; two main strategies platforms use to incentivize, accumulate and extract rent from complementary content resources - complementors. Building on the concept of ´resource functionality´ we show that, for enhanced levels of IPC, exclusive complementors have limited functional value and rareness, failing to bring differentiation capacity to the platform´s system. Also, in line with the logic of ´capability equivalence´, we show that platform´s differentiation in terms of the composition of complementors´ portfolio has a U-shaped relationship with platform performance.

Keywords: Complementary resources; Intra-platform competition; Platform markets; Resource functionatility; Multi-sided markets (search for similar items in EconPapers)
Pages: 43 pages
Date: 2009-07
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Persistent link: https://EconPapers.repec.org/RePEc:emp:wpaper:wp09-06

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