Framework On the Power of Platforms

 Considerable embedded links to supporting information. 

A Framework for Understanding the Power of Platforms

By Irving Wladawsky by IWB / September 08, 2022 at 08:09AM .... 

This past July, MIT’s Initiative on the Digital Economy held its 10th annual Platform Strategy Summit. The hybrid Summit included a number of panels and keynotes throughout the day, a few of which I attended online. In particular, I’d like to discuss the very interesting presentation by Boston University professor Marshall Van Allstyne as part of a panel on emerging trends in which he raised and answered five fundamental questions about platforms:

Structure: Why do platforms have such high market caps but so few assets or employees?

Strategy: Why does traditional product strategy fail in platform markets?

Regulation: Why does traditional antitrust fail in platform markets?

Fake News: Why is misinformation such a hard problem?

Can Decentralized Autonomous Organizations dethrone platforms?

In his presentation, Van Alstyne, aimed to articulate a single framework that will help answer all five questions, that is, a consistent way of thinking about platforms based on the research that he and his colleagues have been conducting over the past decade. Let me summarize Van Alstyne’s presentation by first describing his unifying framework, followed by how the framework applies to each of the five key questions.

Platforms have long played a key role in the IT industry. IBM’s System 360 family of mainframes, announced in 1964, featured a common hardware architecture and operating system. The ecosystem of add-on hardware, software and services that developed around System 360 helped it become the premier platform for commercial computing over the next 25 years.

In the 1980s, the explosive growth of personal computers was largely driven by the emergence of the Wintel platform based on Microsoft’s operating systems and Intel’s microprocessors, which attracted a large ecosystem of hardware and software developers.  .... ' 

Enterprise Digital Innovation Accelleration

Powerful notion to significantly accelerate Innovation and test 

GigaSpaces Joins Forces with IBM and Wix to Offer an Open Platform that Dramatically Accelerates Enterprise Digital Innovation.   This joint solution will enable organizations to speed up the building and launching of new digital services by up to 10x. NEW YORK, July 6, 2022 /PRNewswire/ -- GigaSpaces is joining forces with IBM and Wix to design a joint Digital Acceleration Hub (DAH), that will accelerate the pace at which enterprises and start-ups can build and deploy new digital services. DAH accelerates digital transformation by helping companies build new data services in just days instead of months, as much as 10x.     Read in further  in PR Newswire.  .... ' 

Clash of the Digital Platforms

Not a bad look at what exists,perhaps not enough usage to contextual use details.

The Clash Of The Digital Platforms: The 5-year Update
By James L. McQuivey, Vice President, Principal Analyst  Forrester

On March 7, 2014 I wrote a report called The Clash of the Digital Platforms in which I identified 5 companies that had a unique status in the world of technology, innovation, and overall business. The five companies were (alphabetically) Amazon, Apple, Facebook, Google, and Microsoft. In a byline piece I wrote for AdAge’s DigitalNext column later that month, I wrote:

Marketers Need to Pay Attention to the Battle of the Digital Titans

We’re barely into 2014 and already the biggest digital disruptors are either flexing their muscles anew or apparently getting ready. Google acquired Nest for $3.2 billion, Apple said it has nearly $160 billion in the bank, Amazon is reportedly close to shipping a set-top box for your TV, Microsoft has sold millions of its Xbox One game consoles and Facebook followed its announcement of a record quarter by spending billions to acquire WhatsApp.

It’s an intensifying battle of mythical proportions, and to faraway marketers and product managers in non-digital industries like banking, pharmaceutical or consumer packaged goods, it may seem not worth much thought — because there’s little they can do about it. (AdAge DigitalNext, March 20, 2014) .... "

Become a Platform Company

Even CPG companies are figuring this out now.

The platform play: How to operate like a tech company  in McKinsey  By Oliver Bossert and Driek Desmet

For tech to be a real driver of innovation and growth, IT needs to reorganize itself around flexible and independent platforms.

“The question is not how fast tech companies will become car companies, but how fast we will become a tech company.” This is how the board member of a global car company recently articulated the central issue facing most incumbents today: how to operate and innovate like a tech company.

The tech giants of today have been some of the most innovative companies in the past generation. A handful of industry leaders, such as Ping An and BMW, are fast joining their ranks by reinventing their core business around data and digital. What distinguishes these tech companies is that their technology allows them to move faster, more flexibly, and at greater scale than their competitors. IT is not a cumbersome estate “that gets in the way,” but an enabler and driver of continuous innovation and adaptation.

The reason this is a competitive advantage for tech companies is because their IT is organized around a set of modular “platforms,” run by accountable platform (or product) teams. Each platform consists of a logical cluster of activities and associated technology that delivers on a specific business goal and can therefore be run as a business, or “as a service,” as technologists say. These platforms are each managed individually, can be swapped in and out, and, when “assembled,” form the backbone of a company’s technology capability. Just as important is that the business and tech sides of the company work closely together and have the decision-making authority to move quickly.


This modular, platform-based IT setup of tech companies is what enables them to accelerate and innovate. They can experiment, fail, learn, and scale quickly: they can get products to market 100 times faster than their more lumbering peers (think weeks instead of months). With this kind of speed and flexibility, IT can and should become a focus for innovation and growth at the executive committee and board level. With new technologies and ways of working coming online, tech should be a competitive advantage, not a burden as it is in far too many companies today (see sidebar, “Why now?”). ..... "

100 Million Alexa Devices Sold

Platform War?  Or more like an ecosystem war, the one that will get the most participants creating intelligent value, and combining that into new products.  More more detail at the link.

Amazon says 100 Million Alexa Devices Have been Sold - Whats Next?
Amazon isn’t letting Google own CES (Consumer Electronics Show) without a fight  By Dieter Bohn@backlon  in TheVerge

More than 100 million devices with Alexa on board have been sold. That’s the all-too-rare actual number that Amazon’s SVP of devices and services, Dave Limp, revealed to me earlier this week. That’s not to say Amazon has finally decided to be completely transparent about device sales, however. While the company claims it outstripped its most optimistic expectations for the Echo Dot during the holiday season, Limp wouldn’t give a number for that. Instead, Limp says, Amazon is sold out of Dots through January, despite “pushing pallets of Echo Dots onto 747s and getting them from Hong Kong to here as quickly as we possibly could.”

But back to that 100 million number. Depending on how you count, it’s either seriously impressive or a serious problem for Amazon. On the one hand, 100 million pales in comparison to the number of phones that have either Siri or Google Assistant pre-installed. On the other hand, the word “pre-installed” is the key thing to pay attention to. With Alexa devices, you could argue, consumers are making an active choice to purchase an assistant instead of just getting a default.  .... " 

Forecast for Amazon's Ad Platform

Amazon further monetizes its traffic

Retail Briefing: Amazon’s making the duopoly a triopoly

by Shareen Pathak
Subscribe to the Digiday Retail Briefing: A weekly email with news, analysis and research covering the modernization of retail and e-commerce.

Get ready for publishers to start grousing about the triopoly.

New forecasting from multiple analysts places Amazon’s still-nascent advertising platform as poised to not only become the third leg of the advertising duopoly of Google and Facebook, but also overtake it.

First up was eMarketer, which said it expected Amazon to be No. 3 in digital ad sales in 2018 with $4.6 billion in ad revenue in the U.S. That would mean that its acceleration in growth in ad revenue is putting it on pace to overtake Oath and Microsoft.

There’s a few things Amazon has done right recently. One is that it is much more effective at monetizing its traffic than others are — even others in retail media. A quick look at Amazon’s own search results page shows how many more ads now appear above the fold than used to..... "
  

Cautions About Betting on Platforms

 Most of us are today betting on a platform, the Internet, so this seems odd advice.  But we are also betting on some specifics of the internet, access, architecture and more.    Good cautions.

3 Reasons Why You Shouldn't Bet Your Business On A Platform
The basic laws of business have not changed ...   By Greg Satell in Inc.

" ... However, the basic laws of business have not changed. You still need to create, deliver and capture value in order to compete. In some cases, the best way to do that will be a platform, but in the vast majority of cases it will not be..... " 

Thinking Platform vs Process

Clever way to think about this.

Instead of Optimizing Processes, Reimagine Them as Platforms   by Michael Schrage in HBR

Process optimization can transform user experience. Rethinking process optimization — visualizing processes as platforms — can transform your business model.

One applications outsourcing team, for example, proposed a clever UX tweak to help optimize a global fulfillment process their company managed for its biggest client.

The idea was simple: Instead of making buyers go through the entire online ordering sequence only to find stock-outs or delivery delays, why not alert them to product availability upfront? A little dab of inventory data would enhance both customer expectations and process efficiencies. Surely this cheap, customer-centric, and data-driven innovation would impress the client. .... " 

European Commision on Digital Platforms

In the Economist (registration required) on pricing and Google in the online world.   Are Google (and other large digital platform holders) preventing competition by buying up potential competitors early with their cash?  Also the data resources needed?   In particular with regard to online platforms. Very difficult to forecast the future of small startups.  (Been asked to look at the forecasting aspect of this, so some of the tabs will be filled out later)