Course Outline

Course Number MG-GY 8683

Economics & Strategies for Digital Platforms

Spring 2025, 1/21/2025 – 5/6/2025

Course Scope and Mission

The goal of this course is to equip students with the economic tools and strategic thinking necessary to understand how platform. markets function and how to carefully analyze, evaluate and develop strategies for digital platforms. Many companies are pursuing digital strategies, from a multitude of startups to major players including Google, Amazon and Meta. 

This course will cover topics that help inform. platform. strategy, such as two-sided markets, first mover advantage, network effects, the chicken-or-egg dilemma, monetization strategies, freemium models, intellectual property rights, startup strategy, crowdsourcing, platform. governance, regulation, societal aspects of platforms, ways in which platforms are changing competition, and reasons why platforms fail. We will apply economic and strategic thinking to the study of business cases of different platforms.

Book (recommended)

Geoffrey G. Parker, Marshall W. Van Alstyne, and Sangeet Paul Choudary. Platform. Revolution. 2016. W.W. Norton & Company, Inc.

Evaluation and Grades

Grades are a measure of the performance of a student in individual courses. Students will be evaluated on the basis of how well they command the course materials.

i. Participation/Group Platform. Exercise 10% Ongoing

ii. Case Questions Write-ups 20% Ongoing

iii. Freemium Analysis (Individual)   35% March 10

iv. Group Platform. Exercise Presentation & Paper 35% May 5

(Pres. April 28)

Grade Conversion

A: 94 – 100 A-: 90 – 93 B+: 87 – 89 B: 84 – 86 B-: 80 – 83 C+: 77 – 79

C: 74 – 76 C-: 70 – 73 D+: 67 – 69 D: 65 – 66 F: Below 65

COURSE FORMAT AND EXPECTATIONS

i. Class Participation/Group Platform. Exercise (10%)

One of the primary goals of this course is to help you develop the ability both to clarify your own position on a strategic question related to digital platforms and to be able to articulate and defend it clearly. As this class is highly interactive, regular class attendance and class participation are a critical part of this course. Class contribution is based on attendance and participation in the weekly group platform. exercises.

Each class, we will be doing a group exercise, where we apply the concepts learned in the lectures that week to the development of a platform. business model. At the start of the course, I will ask you to form. small groups (~5 students) and come up with an idea for a platform. Then, each class, we will apply the theoretical concepts we learn to your real-world platform. By the end of the course, you should have a well-developed platform. business plan.

ii. Case Question Write-Ups (20%)

For each class in which we will be discussing a case, I will provide an overview and background of the case, and pose some questions about the case that are relevant for the theme of that week’s topic. You are asked to form. small groups (~5 students) and work on the questions, writing up in sentence form. answers to each of the questions. I will ask each group to email me the write-ups (one write-up per group) and we will then reconvene as a class and have a group discussion about each case question. Case writeups will receive 1 or 0, based on completion.

With cases, you should be able to identify the key issues, problems, and opportunities facing the platform, to articulate and evaluate alternative approaches to the problems, and to describe the course of action that you recommend and the reasons for your recommendations.

iii. Freemium Analysis (35%) A take-home freemium analysis is due on March 10. This is an individual paper, as outlined below.

Instructions: For this assignment, you are asked to choose a platform. that employs or has employed a freemium business model—note that platforms that offer free limited-time trials are not freemium—and analyze its strategy in a paper that does not exceed 1,000 words. Please do not choose any of the online storage companies (i.e. Dropbox, Google Drive, Apple iCloud, Box or Microsoft SkyDrive) for your assignment, as we are discussing those in class. Recommendations for platforms to choose: Spotify, YouTube. In your papers, answer the following questions.

1. What are the advantages and the costs of offering a free version of the product?

2. Could the platform. earn more by not offering a free version of the product? Explain the assumptions – including economic, competitive, and behavioral assumptions for consumers – to support your analysis, and provide information and quantitative evidence to justify those assumptions.

iv. Group Platform. Exercise: Presentation & Paper (35%) Throughout the semester, you have been working weekly in groups to develop your own platforms. For this final group assignment, due on May 5, you are asked to write a paper of up to 1,500 words (due May 5) and give a presentation on April 28.

This assignment consists of two parts. The first part is a 10 minute in-class “pitch deck”-style. presentation consisting of 10 slides (below) on April 28 (5%). This should be a concise presentation that provides an overview of your platform’s business plan. Your 10 slides should address the following:

Pitch Deck – Key Components:

1. Introduction: Briefly introduce the platform, its name, and a one-liner that captures its essence (e.g., “A marketplace connecting freelancers with businesses.”)

2. Problem: Define the problem that exists in the market that your platform. is designed to solve.

3. Solution: Describe how your platform. solves this problem, including the key features and functionalities that enable users to connect, transact, or interact more efficiently.

4. Chicken or Egg Dilemma & Network Effects: How will your platform. solve the chicken or egg dilemma? How will it achieve positive network effects to create value?

5. Monetization Strategy: Describe how your platform. makes money.

6. Competitive Landscape: Discuss existing competitors (comparing, e.g., monetization strategy, number of users, etc.), and emphasize your unique value proposition and differentiation strategy.

7. Intellectual Property: How will you approach intellectual property?

8. Governance: How will you create and sustain good governance on your platform?

9. Regulation: What regulatory issues might your platform. raise, and how will you mitigate them?

10. Closing: End with a strong conclusion that reinforces the platform’s potential, the impact it could have, and your vision for the future.

The second part is a paper, due May 5 (30%), that goes into more detail on the questions underlying the presentation slides.