Platform Business Models – A Case Study of the Technology Industry
The opportunity to create a value exchange environment is uniquely offered by the platform businesses. A novel approach of co-creating value is writing the rules in the platform business world. This paper analyzes the platform business models within the technology industry based on a multiple case study. As the main driver of business performance in this environment is technology, companies are using it to develop new products or to provide technology as a service. Thus, the main objective is to debate on the actual business needs in terms of business model innovation and to investigate how platform business models are developed through strategic acquisitions to achieve competitive advantage. The cases analysis suggests that technology acquisitions made around the core business may contribute to business model innovation. In addition, new partnerships with the external environment may facilitate mutual value creation exchanges and the platform may evolve through adding extra features from its external partners. We contribute to the advancement of business model research by putting platform business model study into the competitive context of the technology industry, with findings on how platforms are used in the digital era to innovate the core business model. From a practitioner’s perspective, this study may help companies to understand the importance of investing in other technology companies and to identify the opportunities of business model innovation through strategic partnerships. The limitation of this study is that the main data used for the multiple case study was derived from secondary sources and it provided insights about each company’s platform business model from a macro perspective.
Adner, R. (2017). Ecosystem as structure: An actionable construct for strategy. Journal of Management, 43(1), 39-58. https://doi.org/10.1177/0149206316678451
Afuah, A. (2004). Business Models: A Strategic Management Approach. McGraw- Hill/Irwin, Boston.
Alcacer, V., & Cruz-Machado, V. (2019). Scanning the Industry 4.0: A Literature Review on Technologies for Manufacturing Systems. Engineering Science and Technology, an International Journal, 22(3), 899-919. https://doi.org/10.1016/j.jestch.2019.01.006
Boons, F., & Lüdeke-Freund, F. (2013). Business models for sustainable innovation: state-of-the-art and steps towards a research agenda. Journal of Cleaner Production, 45, 9-19. https://doi.org/10.1016/j.jclepro.2012.07.007
Bowen, G. A. (2009). Document Analysis as a Qualitative Research Method. Qualitative Research Journal, 9(2), 27-40. https://doi.org/10.3316/QRJ0902027
Broekhuizen, T. L. J., Emrich, O., Gijsenberg, M. J., Broekhuis, M., Donkers, B., & Sloot, L. M. (2019). Digital platform openness: Drivers, dimensions and outcomes. Journal of Business Research, 122, 902-914. https://doi.org/10.1016/j.jbusres.2019.07.001
Calabrese, A., Campisi, D., Capece, G., Costa, R., & Di Pillo, F. (2013). Competiveness and Innovation in High-tech Companies: An Application to the Italian Biotech and Aerospace Industries. International Journal of Engineering Business Management, 5, 40. https://doi.org/10.5772/56755
Casadeus-Masanell & Ricart, J. E. (2011) How to Design A Winning Business Model. Harvard Business Review. Retrieved from http://www.bmg-businessconsulting.com/wp-content/uploads/2012/09/How-to-Redesign -A-Winning-Business-Model.pdf
Chesbrough, H. (2007). Business model innovation: It’s not just about technology anymore. Strategy and Leadership, 35(6), 12-17. https://doi.org/10.1108/10878570710833714
De Reuver, M., Sørensen, C., & Basole, R. C. (2017). The digital platform: a research agenda. Journal of Information Technology, 33(2), 124-135. https://doi.org/10.1057/s41265-016-0033-3
De Reuver, M., Bouwman, H., and MacInnes, I. (2009). Business model dynamics: A case survey. Journal of Theoretical and Applied Electronic Commerce Research, 4(1), 1-11. https://doi.org/10.4067/S0718-18762009000100002
Deloitte (2020) COVID-19: Shaping the Future Through Digital Business. Retrieved from https://www2.deloitte.com/content/dam/Deloitte/global/Documents/About-Deloitte/COVID-19/gx-technology-digital-COVID-19-recovery-shaping-future-digital-business.pdf
Deloitte. (2021), 2021 outlook for the US technology industry. Retrieved from https://www2.deloitte.com/us/en/pages/technology-media-and-telecommunications/articles/technology-industry-outlook.html/
Dowie, J., Henningsson, S., Kude, T., and Popp, K. (2017). Merging Platform Ecosystems in Technology Acquisitions: A Governance Perspective, Proceedings of the 25th European Conference on Information Systems (ECIS 2017), 2301-2316. Retrieved from http://aisel.aisnet.org/cgi/viewcontent.cgi?article=1145&context=ecis2017_rp
DXC. Technology (2021). Technology: Industry Overview. Retrieved from https://www.dxc.technology/technology/insights/145881-technology_industry_overview
Eckhardt, J. T., Ciuchta, M. P., & Carpenter, M. (2018). Open innovation, information, and entrepreneurship within platform ecosystems. Strategic Entrepreneurship Journal, 12(3), 369-391. https://doi.org/10.1002/sej.1298
Frery, F., Lecocq, X., & Warnier, V. (2015). Competing with ordinary resources. MIT Sloan Management Review, 56(3), 68-77. Retrieved from https://sloanreview.mit.edu/article/competing-with-ordinary-resources/
Press, G. (2018). How Apple, Amazon, Facebook, Google and Microsoft Made 2018 The Year That IT Mattered A Lot. Forbes. Retrieved from https://www.forbes.com/sites/gilpress/2018/12/30/how-apple-amazon-facebook-google-and-microsoft-made-2018-the-year-that-it-mattered-a-lot/
Forbes. (2020). 16 Pandemic-Driven Tech Trends That Are Here To Stay. Retrieved from https://www.forbes.com/sites/forbestechcouncil/2020/10/19/16-pandemic-driven-tech-trends-that-are-here-to-stay/?sh=7ebdd70f2d12
Gartner. (2020). Gartner Top Strategic Technology Trends for 2021. Retrieved from https://www.gartner.com/smarterwithgartner/gartner-top-strategic-technology-trends-for-2021/
Gawer, A., & Cusumano, M. A. (2014). Industry Platforms and Ecosystem Innovation. Journal of Product Innovation Management, 31(3), 417-433. https://doi.org/10.1111/jpim.12105
Graebner, M., Eisenhardt, K., & Roundy, P. (2010). Success and Failure in Technology Acquisitions: Lessons for Buyers and Sellers. Academy of Management Perspectives, 24, 73-92. https://doi.org/10.5465/amp.24.3.73
Grewal, D., Hulland, J., & Kopalle, P. K. (2020). The future of technology and marketing: a multidisciplinary perspective. Journal of the Academy of Marketing Science, 48, 1-8. https://doi.org/10.1007/s11747-019-00711-4
Geissdoerfer, M., Vladimirova, D., & Evans, S. (2018). Sustainable business model innovation: A review. Journal of Cleaner Production, 198, 401-416. https://doi.org/10.1016/j.jclepro.2018.06.240
International Finance Corporation. (2020) The Impact of COVID-19 on Disruptive Technology Adoption in Emerging Markets. Retrieved from https://www.ifc.org/wps/wcm/connect/537b9b66-a35c-40cf-bed8-6f6 18c4f63d8/202009-COVID-19-Impact-Disruptive-Tech-EM.pdf?MOD=AJPERES&CVID=njn5xG9
Johnson, M. W., Christensen, C. M., & Henning, K. (2008). Reinventing Your Business Model. Harvard Business Review. Retrieved from https://hbr.org/2008/12/reinventing-your-business-model
Karhu, K., Gustafsson, R., Eaton, B. Sørensen, C., & Henfridsson, O. (2020). Four Tactics for Implementing a Balanced Digital Platform Strategy. MIS Quarterly Executive, 19(2). 105-120. https://doi.org/10.17705/2msqe.00027
Karhu, K., & Ritala, P. (2020). Slicing the cake without baking it: Opportunistic platform entry strategies in digital markets. Long Range Planning, https://doi.org/10.1016/j.lrp.2020.101988.
KPMG. (2020) Technology industry CEO outlook. Retrieved from https://assets.kpmg/content/dam/kpmg/xx/pdf/2020/10/technology-industry-ceo-outlook.pdf
Lindgren, P., Taran, Y., & Boer, H. (2010). From single firm to network-based business model innovation. International Journal of Entrepreneurship and Innovation Management, 12(2), 122-137. https://doi.org/10.1504/IJEIM.2010.034417
Lindgardt, Z., Reeves, M., Stalk, G., & Deimler, M. S. (2009). Business Model Innovation. When the Game Gets Tough, Change the Game. The Boston Consulting Group, Boston. Retrieved from https://image-src.bcg.com/Images/BCG_Business_Model_Innovation_Dec_09_tcm56-121706.pdf
Li, G., Hou, Y., & Wu, A. (2017) Fourth Industrial Revolution: technological drivers, impacts and coping methods. Chinese Geographical Science, 27, 626-637. https://doi.org/10.1007/s11769-017-0890-x
Maucuer, R., & A. Renaud (2019). Business Model Research: A Bibliometric Analysis of Origins and Trends, Management, 22(2), 176-215. https://www.cairn.info/revue-management-2019-2-page-176.htm?ref=doi
McKinsey. (2020) The technology industry in 2020 and beyond. Retrieved from https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/the-technology-industry-in-2020-and-beyond#
Mezger, F. (2014). Toward a Capability-based Conceptualization of Business Model Innovation: Insights from an Explorative Study. R & D Management, 44(5), 429-449. https://doi.org/10.1111/radm.12076
Morris, M., Schindehutte, M., & Allen, J. (2005). The entrepreneur’s business model: toward a unified perspective. Journal of Business Research, 58(6), 726-735. https://doi.org/10.1016/j.jbusres.2003.11.001
Osterwalder, A., Pigneur, Y., & Tucci, C. (2010). Clarifying Business Models: Origins, Present, and Future of the Concept. Communications of AIS, 16. https://doi.org/10.17705/1CAIS.01601
Parker, G. G., & Van Alstyne, M. W. (2018) Innovation, openness, and platform control. Management Science, 64, 2973-3468. https://doi.org/10.1287/mnsc.2017.2757
PwC. (2017). Sizing the prize: What’s the real value of AI for your business and how can you capitalise? Retrieved from https://www.pwc.com/gx/en/issues/analytics/assets/pwc-ai-analysis-sizing-the-prize- report.pdf
Plantin, J. C., Lagoze, C., Edwards, P. N., & Sandvig, C. (2016). Infrastructure studies meet platform studies in the age of Google and Facebook. New Media & Society, 20(1), 293-310. https://doi.org/10.1177/1461444816661553
Rasmussen, B. (2007). Business Models and the Theory of the Firm. Working Paper. Victoria University of Technology, Melbourne, Australia. Retrieved from http://vuir.vu.edu.au/id/eprint/15947
Romero, D., & Molina, A. (2011). Collaborative Networked Organisations and Customer Communities: Value Co-Creation and Co-Innovation in the Networking Era. Production Planning & Control, 22. 447-472. https://doi.org/10.1080/09537287.2010.536619
Sadq, Z., Nuraddin, S., & Saeed, H. (2018). Analyzing the Amazon success strategies, Journal of Process Management. New Technologies, 6, 65-69. https://doi.org/10.5937/jouproman6-19264
Serkan A. (2013). Two-Sided Markets: Apple's Digital Application Platform. Journal of Social Science Research, 1(1). https://doi.org/10.24297/jssr.v1i1.3053
Steininger, D. M., Wunderlich, P., & Pohl, F. (2013). Exploring Competitive Advantage of Social Networking Sites: A Business Model Perspective. ECIS 2013 Proceedings, paper 214. Retrieved from https://aisel.aisnet.org/ecis2013_cr/214.
Taeuscher, K., & Laudien, S. M. (2018). Understanding platform business models: A mixed methods study of marketplaces. European Management Journal, 36(3), 319-329. https://doi.org/10.1016/j.emj.2017.06.005
Teece, D. (2010). Business Models, Business Strategy and Innovation. Long Range Planning, 43(2e3), 172-194. https://doi.org/10.1016/j.lrp.2009.07.003
Teece, D. J. (2018). Business models and dynamic capabilities. Long Range Planning, 51(1), 40-49. https://doi.org/10.1016/j.lrp.2017.06.007
Tiwana, A. (2014). The Value Proposition of Platforms. Platform Ecosystems in Platform Ecosystems. Morgan Kaufmann. Retrieved from https://static1.squarespace.com/static/5ba7b499755be22c410b1cae/t/5d619cf1 4aa7270001322054/1566678272862/Platform+Ecosystems.pdf
Ulrich D. (2017). Apple, Amazon, Google, Facebook, Microsoft: Market concentration - competition - innovation strategies. Universität Stuttgart, SOI Discussion Paper No. 2017-01.
Wonglimpiyarat, J. (2012). Technology strategies and standard competition — Comparative innovation cases of Apple and Microsoft. The Journal of High Technology Management Research, 23(2), 90-102. https://doi.org/10.1016/j.hitech.2012.06.005
Wirtz, B. W., Schilke, O., & Ullrich, S. (2010). Strategic Development of Business Models. Long Range Planning, 43(2-3), 272–290. https://doi.org/10.1016/j.lrp.2010.01.005
Wirtz, B. W., Pistoia, A., Ullrich, S., & Göttel, V. (2016). Business Models: Origin, Development and Future Research Perspectives. Long Range Planning, 49(1), 36-54. https://doi.org/10.1016/j.lrp.2015.04.001
World Economic Forum. (2020) 3 ways tech solutions can help the world weather COVID-19. Retrieved from
Yang, M., Evans, S., Vladimirova, D., & Rana, P. (2016). Value uncaptured perspective for sustainable business model innovation. Journal of Cleaner Production. 140(3), 1794-1804. https://doi.org/10.1016/j.jclepro.2016.07.102
Yin, R. K. (1994). Case study research - Design and Methods, Sage Publications.
Zhao, Y., Von Delft, S., Morgan-Thomas, A., & Buck, T. (2019). The evolution of platform business models: Exploring competitive battles in the world of platforms. Long Range Planning, 101892. https://doi.org/10.1016/j.lrp.2019.101892
Zott, C., Amit, R. H., & Massa, L. (2011). The Business Model: Recent Developments and Future Research. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.1674384
This work is licensed under a Creative Commons Attribution 4.0 International License.
Copyright for this article is retained by the author(s), with first publication rights granted to the journal.
This is an open-access article distributed under the terms and conditions of the Creative Commons Attribution license (http://creativecommons.org/licenses/by/4.0/).