Platforms, Markets and Innovation

Platforms, Markets and Innovation

Edited by Annabelle Gawer

Annabelle Gawer presents cutting-edge contributions from 24 top international scholars from 19 universities across Europe, the USA and Asia, from the disciplines of strategy, economics, innovation, organization studies and knowledge management. The novel insights assembled in this volume constitute a fundamental step towards an empirically based, nuanced understanding of the nature of platforms and the implications they hold for the evolution of industrial innovation. The book provides an overview of platforms and discusses governance, management, design and knowledge issues.

Chapter 3: Platform Dynamics and Strategies: From Products to Services

Annabelle Gawer

Subjects: business and management, strategic management, economics and finance, economics of innovation, industrial organisation, services, innovation and technology, economics of innovation

Extract

3. Platform dynamics and strategies: from products to services Annabelle Gawer INTRODUCTION The emergence of industry platforms is a novel phenomenon impacting most industries today, from products to services. Industry platforms are building blocks (they can be products, technologies or services) that act as a foundation upon which an array of firms (sometimes called a business ecosystem) can develop complementary products, technologies or services. Platforms exist in a variety of industries, and they certainly exist in all high-tech industries. Google, Microsoft Windows, cellphone operating systems, fuel-cell automotive engines, but also some genomic technologies are all platforms. But while platforms are becoming more and more pervasive, and promising research has been under way (Bresnahan and Greenstein, 1999; Gawer and Cusumano, 2002 and 2008; West, 2003; Rochet and Tirole, 2003 and 2006; Iansiti and Levien, 2004; Eisenmann et al., 2006; Evans et al., 2006; Gawer and Henderson, 2007), important questions remain unanswered. In particular, we don’t yet understand the conditions under which industry platforms come to exist, and then to develop. We also don’t know much about how firms’ capabilities should impact their platform strategies. The chapter aims to answer two research questions: (1) under which conditions can we expect industrial platform dynamics to emerge and unfold? And (2) in the context of platform industry dynamics, what kind of platform strategies should firms devise, depending on whether they are incumbents or new entrants? To answer to the first question, I set out to present a new typology of platforms, which identifies the...

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