ECIS 2020 Research Papers

Abstract

EU firms are largely dominated by American platforms in online consumer-facing markets as well as cloud computing services and are likely to face domination in further markets. In contrast, China has mainly escaped American domination and established a self-sufficient platform economy. This situation provides the opportunity to move beyond research on firm-level strategies of platform competitiveness and to assess national factors that foster the emergence and growth of digital platforms. Understanding different platform breeding grounds is essential to guide EU regulators toward a selfsufficient European platform economy and to help them protect EU firms from the risk of exploitation by dominant platforms. These insights are also important to develop a theory of platform regulation, especially as dominant platforms violate EU laws. To address this gap, this study builds upon 32 expert interviews across 7 EU countries and 19 industries. Our results indicate that in general, a fragmented market, risk-aversion, lack of local clusters, and lack of funding and, more specifically, late entrance, legacy systems, and historic dependence have led to the EU’s platform gap. We discuss why and how EU regulators should intervene and propose a regulatory strategy that establishes a selfsufficient EU platform economy.

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