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Defensive competitive strategies in two-sided markets: The example of the mail industry


Dietl, H; Grütter, A; Lutzenberger, M (2009). Defensive competitive strategies in two-sided markets: The example of the mail industry. Competition and Regulation in Network Industries, 10(1):3-15.

Abstract

This paper outlines and analyzes different competitive strategies for an established platform provider in a two-sided market to defend against various forms of attack. Taking into account the characteristics of two-sided markets, we consider strategies based on product innovation
and network effects, process innovation and pricing, multiple platforms, and switching costs.
Network effects introduce dynamics that can quickly displace an incumbent platform.
However, a platform provider can also use network effects to its advantage, entrenching itself firmly in the market by using appropriate strategies. These strategies are developed theoretically and illustrated by example of the mail industry.

Abstract

This paper outlines and analyzes different competitive strategies for an established platform provider in a two-sided market to defend against various forms of attack. Taking into account the characteristics of two-sided markets, we consider strategies based on product innovation
and network effects, process innovation and pricing, multiple platforms, and switching costs.
Network effects introduce dynamics that can quickly displace an incumbent platform.
However, a platform provider can also use network effects to its advantage, entrenching itself firmly in the market by using appropriate strategies. These strategies are developed theoretically and illustrated by example of the mail industry.

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Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Business Administration
Dewey Decimal Classification:330 Economics
Language:English
Date:2009
Deposited On:08 Jun 2010 14:12
Last Modified:05 Apr 2016 14:10
Publisher:Intersentia NV
ISSN:1783-5917
Related URLs:http://www.crninet.com (Publisher)

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