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The Impact of Self-Operating Complementary Business on Platform Ecosystem under Cross-Group Network Externalities |
PAN Xiaojun |
Shanghai Jiaotong University, Shanghai, China |
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Abstract A game model is constructed for the platform ecosystem based on supplier competition to analyze the effects of cross-network externalities and platform self-supporting complementary business on cooperative competition within the platform ecosystem. The study shows that: As long as the complementary products are not perfectly substituted, the platform will not squeeze out the complementary competitors after self-operating complementary business, and the market share and profit will increase with the intensity of cross-network externalities and decrease with the degree of substitution; In the presence of cross-network externalities, the platform self-operating complementary business will increase the market share of platform firms, but not necessarily decrease the competing suppliers’ market share. When the degree of competition in the complementary market is low, platform entry into the complementary market will increase the market share and profit of suppliers; Platform-owned complementary businesses increase the profitability of the platform ecosystem.
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Received: 03 May 2022
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