Recent literature has shown that the existence of supply and demand-side non-generic complementarities („demand-side linkages”) within ecosystems questions the pertinence of defining a single relevant market comprising substitute products (”substitutability approach”). However, empirical methodologies to measure these linkages and assess the competitive dynamics underpinning them are lacking. Using recent data from internet traffic between the major 246 European digital platforms, we develop such a methodology and test some theoretical findings of the ecosystems literature with major implications for competition and regulatory analysis. We corroborate that demand-side linkages are a non-negligible phenomenon: 18% of these platforms show them. However, unlike what the ecosystems literature predicts, in roughly half of the cases they do not link complementors but platforms competing in at least one market. Finally, while, as expected, we observe demand-side linkages mostly within industry-defined ecosystems, we find evidence of industry-agnostic ecosystems. These could be orchestrated „organically” by platform users instead of by a firm. We conclude that the substitutability approach is not obsolete, but requires being complemented with alternative approaches in order to i) take into account coopetition within the same relevant market and ii) analyze how the competitive process in one market can impact the welfare generated in another (industry’s) market through non-generic complementarities.
Dr. Bruno Carballa Smichowski
European Commission – Joint Research Centre
Researcher at the Joint Research Centre of the European Commission - Unit B6 - Digital Economy at European Commission. Collaborative Economy and Data Economics Expert at Chronos (Media Mundi). PhD Scholar and Teaching Assistant at Université Paris 13.
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A series of Polish-language meetings during which researchers and guest speakers look at issues related to digital transformation, new technologies, innovation and digital research methods.
The aim of the "Digitisation under the closer look of science" seminars is to build cooperation between academia, the public sector and business. Scientists share their research findings and have the opportunity to discuss them with experts. The results of their work are available on the DELab UW website.