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Course Overview
Multi-sided markets or platforms (platforms in short) create value by enabling interactions
between two or more distinct types of affiliated customer groups. Uber, Airbnb, Facebook,
Google are some of the prominent platforms that have redefined the business landscape in
recent times. While platforms have existed for millenia, recent advancements in digital
computing, internet and mobile broadband have opened avenues for innovative business
models for platforms in the last couple of decades. The phenomenal growth of platforms in
this time has triggered the interest of academic researchers and practicing managers in
gaining better understanding of the nature of multi-sided platforms and strategies to succeed
in platform businesses.
Traditional conceptual frameworks for competitive strategy do not always provide the
appropriate insights to succeed in platform businesses and can often point to counter-
productive implications and recommendations. Practicing managers and researchers alike
have come to the realisation that platform businesses need a fresh thinking, distinct and
different from that commonly used in traditional competitive strategy contexts.
This elective course in strategic management aims to help students develop understanding
of multi-sided platform businesses through insights into conceptual frameworks and
application of analytical approaches to deal with strategic challenges faced by platform
businesses. The course draws heavily on recent research as well as pedagogical
developments in multi-sided platforms. Our viewpoint will be that of the CEO or business
head responsible for growing and sustaining the performance of a multi-sided platform
business.
Learning Objectives
The course seeks to equip the students with understanding of:
– Multi-sided platform businesses and how they are different from conventional businesses
– Strategic challenges unique to multi-sided platforms and their impact in business success
– Conceptual frameworks to think through the strategic challenges for platforms
– Analytical frameworks to enable generation of insights and development of
recommendations to address the strategic challenges faced by platform businesses
– Practical, hands-on aspects of applying analytical frameworks
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Email: saiprakash.iyer@iimu.ac.in, Mobile: +91 98 8416 3798
Course Outline
Page 1 of 10
How We Learn
Learning will primarily be facilitated through discussion of cases, as the concepts and
techniques covered in the course are best understood through practice. The effectiveness of
case teaching method depends on both the instructor and the students. The students, as
participants to case discussions, have the responsibility to prepare for the case prior to the
session and actively participate in the discussion of cases in class.
Students are expected to submit pre-class case write-ups which help them structure and
articulate their analysis of the case context and key questions.
Evaluation
Course evaluation shall comprise of three components:
Class Participation Individual assessment 20%
Midterm Examination Individual assessment 40%
Endterm Examination Individual assessment 40%
Class Participation
Active participation in the class discussion by the students is essential for the effectiveness
of teaching through cases. This component of evaluation seeks to reward students for
participating in the class in a well-prepared, well-structured and meaningful way that
enhances the learning experience of all including the instructor. Evaluation will cover both
the quality and frequency of participation across all the sessions in this course.
Special Requirements
Students with special requirements are advised to write to the instructor prior to start of the
course or discuss with the instructor in the first day of the course.
Office Hours
The instructor will share office hours at the time of start of the course. Students are
encouraged to make use of instructor’s time to clarify learnings as well as address any learning
difficulties. The instructor can also be reached via email.
Course Materials
Session readings and cases are available in the course pack. List of readings and cases for
each session is listed in Schedule of Topics.
For some of the topics, links are provided to useful online resources such as articles, short
videos, that help you gain a better understanding of the context of the case for day. These
resources are not available in your course pack – these need to be accessed from the internet.
Readings
– Hagiu, A. (2013) Multi-sided Platforms - Foundations & Strategy (HBSP Note 9-714-
436)
– Christensen, C. M., et. al. (2016) Know Your Customers’ “Jobs to be Done”, Harvard
Business Review, Sep 2016, p54-62 (HBSP reprint R1609D)
Case
– Uber: Changing the Way the World Moves (HBS case 9-316-101)
Online resources
– Technology Giants at War: Another Game of Thrones, The Economist, 01 Dec 2012
(https://www.economist.com/news/21567361-google-apple-facebook-and-amazon-are-
each-others-throats-all-sorts-ways-another-game)
– Networks and the Nature of the Firm, Tim O'Reilly, 14 Aug 2015
(https://wtfeconomy.com/networks-and-the-nature-of-the-firm-28790b6afdcc)
Discussion Questions
1. Articulate the key features of Uber that makes it a multi-sided platform.
2. What is the job to be done (value proposition) that Uber offers its various sides?
3. How does Uber build a virtuous loop through cross-side network effects?
4. What challenges does Uber face in growing and making profits (apart from regulatory
challenges)?
Readings
– Evans, D. S. & Schmalensee, D. (2016) Friction Fighters, Chapter 4 in Matchmakers:
The New Economics of Multisided Platforms, Harvard Business Review Press, Boston,
MA.
– Zhu, F. & Furr, N. (2016) Products to Platforms: Making the Leap, Harvard Business
Review, Apr 2016 (HBSP reprint R1604E)
Case
– Intuit Quickbooks: From Product to Platform (HBS case 8-714-433)
Discussion Questions
1. Should Intuit pursue platform business opportunities for QuickBooks? Why/ why not?
2. If Intuit were to pursue platform business opportunities, what should be the design
features of its platform business? Elaborate the design (for instance how many sides,
open/ closed, what is the value proposition offered to each side, how will this create value
to all sides and the platform etc., etc.)
3. Justify your design recommendation. (Hint: think in terms of options such as (a) do not
enter platform business, (b) create a one-sided platform (peer-to-peer linkages), (c ) create
a platform for third-party developers, but no own platform offerings, (d) create QBF and/
or Concierge, (e ) combine c and d, etc., etc.).
Readings
– Evans, D. S. & Schmalensee, D. (2016) Ignite or Fizzle, Chapter 5 in Matchmakers: The
New Economics of Multisided Platforms, Harvard Business Review Press, Boston, MA.
Case
– Brightcove Inc. in 2007 (HBS case 9-712-424)
– Brightcove Inc. (B) (HBS case 9-712-436) to be distributed in class
Online Resources
– A very short take on how YouTube platform works
(https://digit.hbs.org/submission/youtube-1-everyone-else-0/)
Discussion Questions
1. Consider the 4-sided platform design of Brightcove. Can you articulate the value
proposition that each side gets from the platform?
2. Does the design enable platform ignition? Why/ why not?
(Hint: think in terms of a) who pays for what, b) different types of customers within each
side - how are they likely to view the platform design in terms of their utility, c) which
side Brightcove went after first etc.)
Readings
– Evans, D. S. & Schmalensee, D. (2016) Beyond the Castle Walls, Chapter 7 in
Matchmakers: The New Economics of Multisided Platforms, Harvard Business Review
Press, Boston, MA.
Case
– Twitter (HBS Case 9-710-455)
Discussion Questions
1. How did Twitter build its user base? (Hint: think in terms of the value proposition that
Twitter offers its users)
2. Are there different types of users? (Hint: who contributes content, who follows, who does
not follow etc.)
3. How does Twitter’s current platform design enable generation of revenues and profits?
4. How would you redesign Twitter to enhance its ability to grow and sustain its profits?
Readings
– Evans, D. S. & Schmalensee, D. (2016) Long Haul, Chapter 6 in Matchmakers: The New
Economics of Multisided Platforms, Harvard Business Review Press, Boston, MA.
Case
– M-Pesa and Mobile Money in Kenya: Pricing for Success (Kellogg case KEL762)
Online Resources
– M-Pesa intro documentary (http://www.youtube.com/watch?v=zQo4VoLyHe0)
Discussion Questions
1. What is the key problem that M-Pesa sought to solve for the Kenyan wananchi?
2. What is the pricing structure adopted for M-Pesa for the different sides of the platform?
Does it make sense? Why/ why not?
3. What seems to be the bigger challenge in ignition - getting users in, or getting agents in?
How did M-Pesa solve this problem?
Readings
– Boudreau, K. J. & Hagiu, A. (2009) Platform Rules: Multi-sided Platforms as Regulators,
Chapter 7 in Platforms, Markets and Innovation, Annebelle Gawer (ed), Edward Elgar,
Cheltenham, UK.
Case
– TopCoder (A): Developing Software Through Crowdsourcing (HBS case 9-610-032)
Online Resources
– Topcoder Members of the Month Jun 2016 (https://youtu.be/8JaEX-YFHiA)
Discussion Questions
1. Consider the platform design for TopCoder. Articulate the value proposition offered by
TopCoder to various sides of the platform.
2. Consider the divergence of motivations for various types of developers signing up for
TopCodera. What are the key issues TopCoder is likely to face with a homogeneous
approach to managing its developer base?
3. For what type of client problems would TopCoder's current governance work well? For
which problems would it fail? Why (for both)?
(Hint: think in terms of the development process (column 1 in Exhibit 5) and how well
contests will work in each of these stages)
4. How well did TopCoder model address two key concerns of CIOs - cost overrun and
delay? Who bears the risk of cost overrun and delay in TopCoder developed projects?
5. Is TopCoder likely to grow with current governance model? Why/ why not?
Readings
– Evans, D. S. & Schmalensee, D. (2016) Fakesters or Fraudsters, Chapter 9 in
Matchmakers: The New Economics of Multisided Platforms, Harvard Business Review
Press, Boston, MA.
Case
– Airbnb (A) (HBS case 9-912-019)
Online Resources
– Blogpost by EJ on 29 Jun 2011 (http://ejroundtheworld.blogspot.in/2011/06/violated-
travelers-lost-faith-difficult.html)
– Follow up blogpost by EJ on 28 Jul 2011
(http://ejroundtheworld.blogspot.in/2011/07/airbnb-nightmare-no-end-in-sight.html)
Discussion Questions
1. Was Airbnb responsible for EJ’s predicament? Why/ why not? What is your take on
Airbnb’s first response, as reflected in EJ’s second blogpost?
2. How does the episode reflect on the reputation of Airbnb, and what are the implications
for Airbnb?
3. Could Airbnb have averted the predicament faced by EJ? How?
4. What would you recommend to Airbnb to avoid such situations in future? How
implementable is your recommendation in terms of feasibility, cost etc.? Assess.
Readings
– Gawer, A. & Cusumano, M. A. (2008) How Companies Become Platform Leaders, MIT
Sloan Management Review, Vol 49(2)
– Suarez, F. F. & Kirtley, J (2012) Dethroning an Established Platform, MIT Sloan
Management Review, Vol 53(4)
Case
– Videogames: Clouds on the Horizon? (HBS case 9-713-424)
Online Resources
– History of video game consoles in three parts (https://youtu.be/DdxH5rRFRbg,
https://youtu.be/n6I6iP0RVCw and https://youtu.be/BvYFM6eUn-M)
– … and the rap version (https://youtu.be/w76cf2Dce9I)
Discussion Questions
1. What business models did the leading console makers adopt (during the console era, i.e.,
before the advent of mobile or cloud gaming)? How did they make money?
2. Is leadership in console sales essential for profitability of console maker? Why/ why not?
Can a console maker generate profits while not being the leader in console sales? If so,
how? If not, why?
3. How will cloud gaming change the competitive landscape for game console makers?
4. How should console makers respond to the advent of cloud gaming?
Readings
– Evans, D. S. & Schmalensee, R. (2016) Why Winner-Takes-All Thinking Doesn’t Apply to
the Platform Economy, Harvard Business Review, May 2016 (HBSP reprint H02V9K)
– Eisenmann, T. R. (2007) Winner Take All in Networked Markets (HBSP Note 9-806-131)
Case
– Linux Vs Windows (HBS case 9-707-465)
Discussion Questions
1. How did Microsoft build its dominant position (95% market share) in the PC operating
system market? Identify key drivers.
2. What challenges did Linux face specifically in gaining market share in the PC operating
system market?
3. How is the market for server OS different from that of PC OS? How did this impact the
WTA characteristics?
4. How did Linux manage to gain market share in server OS market? What can it do to
replicate this success in PC OS market?
Readings
– Eisenmann, T., Parker, G. and Van Alstyne, M. (2011), Platform Envelopment, Strategic
Management Journal, 32(12): 1270–128 (doi:10.1002/smj.935)
Case
– PayPal Merchant Services (HBS case 9-806-188)
Discussion Questions
1. What is PayPal’s platform strategy? How well is it exploiting the market opportunity for
payments?
2. Who are the main competitors to PayPal (before Google)? How is PayPal positioned
against its rivals?
3. How serious a threat to PayPal is Google? Why?
4. How should PayPal address the challenge from Google (if at all)? Justify.