Business Insights: Global Markets, Strategy & Economic Trends
- Assess the broader digital ecosystem value from combining platforms, including developers, partners, and complementors creating new monetization opportunities.
- Measure enhanced network effects and cross-platform synergies that drive user engagement and long term competitive advantage.
- Evaluate integration costs, APIs, and incentives that attract third-party developers and partners to reinforce platform value.
- Use metrics beyond market share, including interconnection value, data flows, and complementor economics to quantify ecosystem gains.
Traditionally, potential M&A deals are evaluated based on factors like market power and access to new capabilities. Consider Facebook’s acquisition of Instagram in 2012 for $1 billion. At the time, the deal was widely viewed as a defensive maneuver against a fast-rising competitor and a way for Facebook to strengthen its position in mobile photo sharing. But nearly 15 years later, the logic of the deal is seen in a different light. As our research suggests, an important and increasingly relevant source of value may have been overlooked: the opportunity to combine two ecosystems and create new value through enhanced connections with developers, partners, and other complementors.
Read the full article from the original source
