Battle of Platforms: Unlocking Profitability in Multi-Sided Software Platform Business Models

Vorschau

Leseprobe, PDF (240 KB)
Inhaltsverzeichnis, PDF (160 KB)

Software platforms have become central to the digital economy,
reshaping industries and accelerating growth far beyond traditional
business models. Their success stems from multi-sided ecosystems
that integrate consumers and complementors, leverage strong
network effects, and enable rapid scale with limited resources.
This book presents a market model for profit-maximizing pricing
strategies in software platform markets, focusing on the interactions
between consumers, complementors, and platform owners. The
analysis shows that variable, transaction-based fees are optimal
once complementor participation exceeds 50 %, and that sustainable
oligopolies depend on stable participation equilibria across market
sides. When multiple equilibria exist, markets tend to tip toward
monopoly as one platform attracts most single-homing consumers.
Building on these insights, the book offers strategic guidance for
incumbents and entrants based on complementor heterogeneity and
consumer benefits.
Applying the model to the mobile app market illustrates its practical
relevance, showing that real-world two-platform competition often
converges to a single stable equilibrium—challenging earlier
predictions from one-platform frameworks.