Hagiu, Andrei, Jullien, Bruno and Wright, Julian (2018) Creating platforms by hosting rivals. TSE Working Paper, n. 18-970, Toulouse

There is a more recent version of this item available.
[thumbnail of wp_tse_970.pdf]
Download (498kB) | Preview


We explore conditions under which a multiproduct firm can profitably turn itself into a platform by "hosting rivals", i.e. by inviting rivals to sell products or services on top of its core product. Hosting eliminates the additional shopping costs to consumers of buying a specialist rival's competing version of the multiproduct firm's non-core product. On the one hand, this makes it easier for the rival to compete on the non-core product. On the other hand, hosting turns the rival from a pure competitor into a complementor: the value added by its product now helps raise consumer demand for the multi-product firm's core product. As a result, hosting can be both unilaterally profitable for the multi-product firm and jointly profitable for both firms.

Item Type: Monograph (Working Paper)
Language: English
Date: November 2018
Place of Publication: Toulouse
JEL Classification: D4 - Market Structure and Pricing
L1 - Market Structure, Firm Strategy, and Market Performance
L5 - Regulation and Industrial Policy
Divisions: TSE-R (Toulouse)
Institution: Université Toulouse Capitole
Site: UT1
Date Deposited: 30 Nov 2018 09:15
Last Modified: 02 Apr 2021 15:58
OAI Identifier: oai:tse-fr.eu:33123
URI: https://publications.ut-capitole.fr/id/eprint/26529

Available Versions of this Item

View Item


Downloads per month over past year