Platform Competition: A Systematic and Interdisciplinary Review of the Literature

Abstract

Over the past three decades, platform competition—the competition between firms that facilitate transactions and govern interactions between two or more distinct user groups who are connected via an indirect network—has attracted significant interest from the fields of management and organizations, information systems, economics, and marketing. Despite common interests in research questions, methodologies and empirical contexts by scholars from across these fields, the literature has developed mostly in isolated fashion. This article offers a systematic and interdisciplinary review of the literature on platform competition by analyzing a sample of 333 articles published between 1985 and 2019. The review contributes by (1) documenting how the literature on platform competition has evolved; (2) outlining four themes of shared scholarly interest, including how network effects generate “winner-take-all” dynamics that influence strategies such as pricing and quality, how network externalities and platform strategy interact with corporate-level decisions such as vertical integration or diversification into complementary goods, how heterogeneity in the platform and its users influences platform dynamics, and how the platform “hub” orchestrates value creation and capture in the overall ecosystem; and, (3) highlighting several areas for future research. The review aims to facilitate a broader understanding of the platform competition research that helps to advance our knowledge of how platforms compete to create and capture value.

Keywords: platform, ecosystem, complementor, two-sided market, competition