Competitive Dynamics in the ICT Sector: Strategic Decisions in Platform Ecosystems

Abstract

In recent years, an increasing number of telecommunications companies such as BlackBerry Ltd. and software companies such as Apple Inc. or Google Inc. strived for a leading platform status within the information and communication technology (ICT) sector. While platform theory is able to cover platforms as isolated entities, it reaches its limits when covering the recent platformization of these modularized markets. Thus, this paper explores how the new platformized market structure has influenced companies’ strategic decisions concerning technological developments in the ICT sector. Specifically, it will look at three exploratory case studies: Facebook Inc.’s announcement of its launcher application Home, BlackBerry Ltd.’s introduction of its new operating system QNX, and Apple Inc.’s development of its own navigation application Maps. It concludes that the attractiveness of a platform status within the sector lead to the emergence of complex ecosystems based on the economic logic of cross-sided network effects in which platform companies can follow a unique and new set of strategies.

Keywords: platform, two-sided market, platform strategy, platform competition, Apple, Blackberry, Facebook

JEL Classification: O330, O400