How Digital Platforms Compete – Building and Sustaining Competitive Advantage

With the advent of the internet in the early 1990s, digital platforms have become the fastest growing and most valuable businesses of the economy. Based on new high-speed (mobile) telecommunication networks, access to digital platforms has become universal and facilitated opportunities for innovative services, from online searches to social networks, online auctions to music streaming, real-time news distribution to ubiquitous video entertainment, and so on. All corporate entities, or firms, engaged in this market are fairly young and indeed created a different type of ‘competitiveness’ compared to traditional industries. So ‘how digital platforms compete’, i.e. how they are building and sustaining competitive advantages, is what we are discussing in this seminar. Using the Case Study Method, developed by Harvard Business School (HBS) to educate graduate students, we look at one case at a time in the form of a fact-based case description paper, provided to all participants one week prior to class. Each (weekly) class focuses on one digital platform providers’ competitive performance and discusses its competitive options at the time of the case, covering three broad topic areas: 1) How successful firms build and sustain competitive advantages; 2) Digital platforms’ specific ‘network effects’ and resulting business models and their economic results; 3) Dependence of digital platforms on facilitating network infrastructures . With about 12 different cases, e.g. on Amazon, Google, Spotify and WhatsApp, the variety/multitude of competitive actions for digital platform firms will become apparent during of the seminar. This shall enable students, when later in life confronted with real-life competitive issues, to apply their judgement based on the experience of the variety/multitude of cases discussed in the classroom. That is how close a classroom discussion can come to the ‘real world’. In addition, the active case discussions provide a good exercise of ‘disagreeing in an agreeable manner’, which is good practice.

Knowledge-related outcomes Upon completion of this module, students will be able to: - Define, explain, and apply in practice key theories related to platforms and platform business models - Interpret, classify, and assess the conduct and performance of firms trying to establish, actively deploying, or fighting against platform business models - Describe, compare, and appraise different platform designs for a given situation - Distinguish the newly learned theories of platforms, platform business models from previously learned perspectives - Evaluate how environmental change may affect existing platforms and theories around platform (business models) Skill-related outcomes - Improve diagnostic and analytical skills (i.e., structured problem-solving) - Build up critical thinking and interpretation skills - Enhance verbal and argumentation skills via presentations and group discussions

This module is examined via exercises (“Übungsleistung & Testate”), using two elements to assess the different learning goals of this course. - Oral, individual: 50%. For each session of class, you will be given in advance a set of Assignment Question to prepare for case study discussion. We will assess your contributions to solving these question in class when we discuss the case study to see whether you can define, explain, and apply key elements of the subject matter; describe, compare, and appraise platform business models for a given situation; and build and sustain competive advantage. Students do not have to be present in every session to achieve full marks; given to-be-defined, legitimate circumstances, such as health matters, and instructor permission, students may also submit written solutions prior to class as a basis of grading. Each student should attend a feedback session around the middle of the term to be informed about their current performance - Written, individual: 50%. in the last session of class, students will be provided an exercise sheet, in which students will individually highlight in written, condensed form that they understood the key learnings emerging from a synthesis of the class discussions from the entire course

English proficiency for case preparation and class discussion is critical. Adapting the case specific terminology is necessary for meaningful class discussions. Weekly time budget no less than 5 hours per case (depending on language skills). No specific prior courses necessary. Cases will be provided.

The course will mainly draw on the Case Method, most famously used at Harvard Business School. Since the selected cases were not specifically written for this seminar (Strategy, General Management), ‘assignment questions’ are added to the case preparation in order to provide the specific focus on the seminar theme of competitiveness. There is no objective to ‘solve’ a case and the aim is to show various options from which to choose a preferred way of action. A ‘vote’ on the best ‘strategy’ at the end of a class discussion usually presents the principal options, not ‘right’ versus ‘wrong’, rather a ‘competition’ of the strong against the weak argument presented by the participants.