Post by arfanho7 on Feb 25, 2024 9:58:52 GMT 5.5
The model in this paper explains the incentives for two platforms to become frenemies when the difference in their foci for profits is sufficiently large. That competing platforms with different profit foci may have incentives to cooperate also applies in other settings such as the tablet market or e commerce. Author Abstract We study the compatibility decisions of two competing platforms that generate profits through both hardware sales and royalties from content sales.
We consider a game theoretic model in which the platform hardware may offer different standalone utilities to users who have different preferences over the two platforms. one way Ukraine Mobile Number List compatibility the platform with smaller standalone value allows users of the competing platform to access its content can arise from the difference in their profit foci. As the difference in the standalone utilities increases royalties from content sales become less important to the platform with greater standalone value but becomes more important for the other platform.
Compatibility increases asymmetry between the platforms profit foci and when the difference in the standalone utilities is sufficiently large yields greater profits for both platforms. We further show that social welfare is greater under one way compatibility than under incompatibility and there exist no incentives for either platform to establish one way compatibility the other way round.
We consider a game theoretic model in which the platform hardware may offer different standalone utilities to users who have different preferences over the two platforms. one way Ukraine Mobile Number List compatibility the platform with smaller standalone value allows users of the competing platform to access its content can arise from the difference in their profit foci. As the difference in the standalone utilities increases royalties from content sales become less important to the platform with greater standalone value but becomes more important for the other platform.
Compatibility increases asymmetry between the platforms profit foci and when the difference in the standalone utilities is sufficiently large yields greater profits for both platforms. We further show that social welfare is greater under one way compatibility than under incompatibility and there exist no incentives for either platform to establish one way compatibility the other way round.