Don't get Ubered. What Every Strategist Needs to Know About Digital Competition

1

Don’t Get Ubered: What Every Strategist Needs to Know About Digital Competition !

Annabelle Gawer, PhD Surrey Center for the Digital Economy

Bryan Kirschner Apigee Institute

@AnnabelleGawer @bryan_kirschner

The views expressed in this presentation are those of the presenter, and not necessarily those of Apigee Corporation or the presenter’s employer.

3

Strategist

4 ©2016 Apigee. All Rights Reserved.

Strategist


Change Agent

Steps


Steps


Goal

Let’s talk about “revolutions…”







Innovation


Innovation


Changes the Game

Cyber-Physical Age

16




2005-12-07 15:54 LucaDetomi 300×289×8 (22714 bytes) {{GFDL}} Primo microprocessore Intel, l'[[Intel 4004]].


2005-12-07 15:54 LucaDetomi 300×289×8 (22714 bytes) {{GFDL}} Primo microprocessore Intel, l'[[Intel 4004]].




Shodan


Shodan

Change the Rules for Technology


Change the Rules for Technology


Change the Business Model

Age of the Platform

27

Digital Platforms Competition and Innovation in the Platform Economy

Prof. Annabelle Gawer

I ♥ APIs London, 2 March 2016

▪  Introduction: Why do platforms matter? ▪ Platform Fundamentals –  - What are Platforms / How Platforms Create Value •  - Network Effects / Platform Business Models ▪  Results from the Global Platform Survey ▪  The European Platform Observatory ▪  Discussion + Q&A

Agenda

29

Some of my publications on (mostly digital) platforms

30

Agenda

Technological Platforms

A Gawer’s Platform Research

31

Platform strategies “Platform Leadership”

•  Platform Leadership (HBR 2002)

•  The Elements of Platform Leadership (SMR 2002)

•  How companies become platform leaders (SMR 2008)

Platform competition (economics and strategy) •  Platform owner entry and innovation in complementary markets (JEMS

2007)

Platform governance (organization theory) •  The organization of technological platforms (RSO 2010) •  Institutional work as logics shift: The case of Intel’s transformation to platform leader

(Org Studies 2013) •  Innovation Policy within Private Collectives (Technovation, 2013)

Platform evolution (management & organization theory) •  Modelization, graph

theory •  Ecosystem governance •  Platform boundaries •  Platform business

models

Conceptual clarification, leadership role in platform research •  Platforms, Markets and Innovation (2009) •  Bridging differing perspectives on technological platforms (Research Policy 2014, 6000 downloads, “best paper”

AOM 2014) •  Encyclopedia & Handbook chapters •  Conference and symposia organizer / international reputation •  Keynote speaker

Platform innovation (innovation studies) •  Industry architectures as determinant of successful platform

strategies (EMR 2009) •  Industry platforms and ecosystem innovation (JPIM 2013)

Intro Why do platforms matter

32

#Most unicorns are platforms#

70%

30%

Platforms

Non Platforms

Global Unicorns = 115

Source: P. Evans, CGE; CB Insights, Capital IQ, CrunchBase, 2015

Platform = 80 of 115 companies, $300B valuation

21

Netflix has over 70 million members in over 190 countries. Users watch more than 125 million hours of TV shows and movies per day.

Sources: About Airbnb at: https://www.airbnb.com/about/about-us; Netflix at: https://media.netflix.com/en/press-releases/netflix-is-now-available-around-the-world; About LinedIn at: https://press.linkedin.com/about-linkedin; https://support.google.com/googleplay/answer/2843119?hl=en

Airbnb provides accommodation listings in more than 34,000 cities and 190 countries. There are over 2 million listings world-wide; Paris alone has more than 28,000 listings.

LinkedIn has over 400 million members in over 200 countries. Over 70 percent of users are outside the US. Over 100 million unique users access LlinkedIn each month.

Google Play apps and digital content: Over 1.6 million Android apps are available in 136 countries world wide; Google Play movies available 105 countries; books available in 75 countries; music available in 62 countries.

Platforms provide basis for rapid global scale The New Multinationals

Google play’s platform services Apps, movies, books, music

No. of Services 4 services 3 services 2 services 1 service No service

Russia

Source: Google Play country availability: https://support.google.com/googleplay/answer/2843119?hl=en-GB

Google play’s platform services Apps, movies, books, music

No. of Services 4 services 3 services 2 services 1 service No service

Russia

Source: Google Play country availability: https://support.google.com/googleplay/answer/2843119?hl=en-GB

Platform Fundamentals What are platforms How platforms create value

38

Platforms as Multi-Sided Markets with Network Effects

39

Innovation Platforms

40

Innovation platforms are technologies that facilitate the development of complementary innovation in innovation ecosystems (Gawer & Cusumano, 2002; Gawer, 2009)

•  Economies of scope in innovation •  Sharing IP and tools to connect (APIs) •  Reduced search cost of

complementary innovators •  Reducing barriers to entry for

complementors in complementary innovation

41

The API Economy Google creates APIs to extend search and analytics beyond their own services

www.imperial.ac.uk/business-school Option 1 43

Service Data

Consumes

Produces

Improves experience

Many free services

One data set and common semantic

The more context the more efficient

and the more value

Virtuous Feedback Loops in Digital Platforms

Internet Service Provider

Value enriched Data generates revenue

Example: Search/Information Mgmt : #

Rated auction/Selling:

43

User

BI Based Revenue Models (eg Advertisement)

Core Semantic

Data Set Mindmap

Dating Bars

Amazon market-place

Transactional

Air BnB

UBER

Google

ARM

Intel micro-processor

The platform serves as an intermediary for direct exchange or transactions, subject to network effects

Innovation

The platform serves as a technological foundation on top of which other firms develop complementary innovations

Facebook for Developers

Apple iOS Apple App Store

Google Android

Facebook SAP NetWeaver

Innovation Platforms

MSPs

Match.com Google Play

Apple

AUTOSAR Qualcomm

PLATFORMS

Results from the Platform Survey

45

Companies Pla-orm ecosystem

Hierarchal Organiza7on + Physical Assets*

Asset Heavy Daimler Moovel Johnson Controls Panop7x GE Predix Samsung Tizen

Asset Light Google Google Play Uber Uber app Airbnb Airbnb app Priceline Booking.com

Structure

* Includes HQ, other rooOops, retail outlets, manufacturing plants, service shops, etc.

Pla-orm

Mixed Apple App store Amazon App store

Enterprise type

Examples

Reshaping enterprise structure#

29

64 / $3,123B 27 / $181B 82 / $930B

Global unicorn platform startups Europe is lagging

N. America Europe Asia

Source Global Platform Database 2016 Platform companies with a market value of US$1b or more on Dec 1, 2015

Global unicorn platform startups by city

Source: P. Evans, CGE, CB Insights, Capital IQ and CrunchBase, 2015.

European Platform Landscape

Source: Global Platform Survey, Center for Global Enterprise, 2016

Concentration in “Beer Drinking” Countries, Some in “Vodka Dinking”, none in “Wine Drinking” Countries

Country City

What is needed to support platform growth in Europe?

-  Reliable and complete data on platforms: To inform businesses and governments -  Critical mass of knowledgeable actors

-  Knowledge + Experience networks, and shared expertise around platforms -  Executive training for managers:

-  Platform strategies -  Platform business models -  How to develop innovative ecosystems

-  Please share your ideas !

The European Observatory of the Platform Economy

Be a part of our network

• Contact us

• [email protected]

Thank you

Software

Don't get Ubered. What Every Strategist Needs to Know About Digital Competition