Feeding the network as a part of competitive strategy on the network markets

Szymon Mazurek

Abstract

Network externalities (network effect) are the primary source of the company value on the network market. A network effect means that each additional network node increases the value of the whole network received by each of its users or clients. Achieving of this effect is strictly related to the size of the network. Therefore, the success of a company on the network market is the result of the value of supplied goods and services, but the dynamics of the growth of a network. This paper shows the process of ‘network feeding’ as a part of competitive strategy suitable for the enterprises operating on the network market. Feeding the network is understood here as a range of activities, which lead to the fastest possible expansion of the network which is used for creating and delivering goods and services. Those activities are meant to overcome competition in the race for a critical mass of the network. Following network feeding strategies are analysed in the paper: USB Forum on the market of computer accessories, Tesla Motors on the market of electric cars and Spotify on the market for music streaming services
Author Szymon Mazurek (ES / DIER)
Szymon Mazurek,,
- Department of International Economic Relations
Pages1195-1204
Publication size in sheets0.5
Book Loster Tomas, Pavelka Tomas (eds.): The 12th International Days of Statistics and Economics : Conference Proceedings, 2018, MELANDRIUM, ISBN 9788087990148, 2063 p.
Keywords in Englishnetworks, network effect, network market, standards war, freemium
URL https://msed.vse.cz/msed_2018/article/110-Mazurek-Szymon-paper.pdf
Languageen angielski
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Mazurek_Feeding_the_Network_as_a.pdf 335,85 KB
Score (nominal)15
Score sourceconferenceIndex
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