Disentangling Digital Platform Competition: The Case of UK Mobile Payment Platforms

Abstract

Digital platforms confer competitive advantage through superior architectural configurations. There is, however, still a dearth of research that sheds light on the competitive attributes that define platform competition from an architectural standpoint. To disentangle platform competition, we opted for the mobile payment market in the United Kingdom as our empirical setting. By conceptualizing digital platforms as layered modular architectures and embracing the theoretical lens of strategic groups, this study supplements prior research by deriving a taxonomy of platform profiles that is grounded on the strategic dimensions of value creation and value delivery architectures. We discover that mobile payment platforms could be delineated based on: (1) whether they are integrative or integratable on their value creation architecture; and (2) whether they have direct, indirect, or open access on their value delivery architecture. The preceding attributes of value creation architecture and value delivery architecture aided us in identifying six profiles associated with mobile payment platforms, which in turn led us to advance three competitive strategies that could be pursued by digital platforms in network economies.