Digital platforms and complementors : an empirical analysis based on YouTube content creators

Within the past 15 years, platforms have increasingly dominated markets. Apple, Amazon, Facebook, Google — today’s most successful businesses are platform based business models. “We live in the age of platforms” (Santaló, 2015). At their core, platforms bring together two or more group of users and facilitate transactions among them: eBay links buyers and sellers; Playstation links gamers with developers; Airbnb connects home owners with travelers. More and more entrepreneurial startups are embracing a platform approach, such as Uber and Snapchat. Academics started to study these companies addressing many relevant topics such as: which characteristics a product should have to become a platform (Santaló, 2015), what strategies platform owners can use to launch their platform in the market (Bhargava et al., 2013), infrastructure / network requirements (Constantinides et al., 2018), governance (Foerderer et al., 2018) and so on. One of the main themes is innovation (Gawer, 2014) and the interplay between the platform owner and the ecosystem of companies surrounding the platform. Academics from the economics stream of literature, instead, focused on how to create and grow the network surrounding a platform, looking at pricing structure and competition (Armstrong, 2006; A. J. Rochet et al., 2006; Rysman, 2018). However, despite the growing interest of the scientific community, all these topics have been predominantly researched from the perspective of the platform owner, also called keystone firm (Cennamo et al., 2016). The whole discussion rotates around what the owner should do to be successful, to manage its network and to generate profits (Kim et al., 2017). Little to nothing is known about what the others around the platform, often called complementors (Förderer & Kude, 2016), can do to reap benefits for themselves. There is a strong interplay between the governance policies adopted by the keystone firm, what freedom is left to the rest of the ecosystem and ultimately which strategies they can adopt to escape the platform owner’s control. To explore this research avenue, this thesis looks at the YouTube platform owned by Google. At the heart of the ecosystem surrounding the company, there are content creators (i.e. video makers) who produce the videos that can be watched on the platform. YouTube puts advertisement in front of these videos and the revenues generated are split with the content creator. A series of guidelines define what the creator can and cannot upload on the platform. To make money, compliance is mandatory. However, over the years, many creators tried to create alternative sources of revenues: from selling merchandise to their audience, to accepting donations or even create videos sponsored directly by companies. Each creator created around himself a network of opportunities to leverage their community of viewers and ability to engage people. This thesis serves three main purposes: (1) to investigate what is present in this ecosystem around the creator and how it is created as the creator grows; (2) to understand how policies and control from YouTube affected creators; (3) to synthetize what has been found into proper strategies that creators follow to escape the platform’s control and generate extra profits. Its results, contribute to two main streams of literature: (1) “platform leadership”, but explored from the perspective of a complementor (Adner, 2017; Cennamo, 2016; Gawer & Cusumano, 2014; Parker et al., 2016; Santaló, 2015); (2) the effects and impacts of governance with a focus on how it drives the actions of complementors (Bergvall-Kåreborn & Howcroft, 2014; Foerderer et al., 2018). Overall, clarifying these issues can provide a significant contribution to our current understanding of digital platforms. Given the transformative impact of companies such as YouTube on the world, understanding their inner workings could provide value to: (1) individuals engaging with the platform; (2) companies trying to build platforms in the digital space; (3) researchers investigating what platforms are and what makes them successful.