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CESifo Economic Studies 2005 51(2-3):189-224; doi:10.1093/cesifo/51.2-3.189
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Right arrow L86 - Information and Internet Services; Computer Software
Right arrow L11 - Production, Pricing, and Market Structure; Size Distribution of Firms
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© Ifo Institute for Economic Research, Munich, 2005

A Survey of the Economic Role of Software Platforms in Computer-based Industries

David S. Evans, Andrei Hagiu and Richard Schmalensee*

* David S. Evans, LECG LLC 350 Massachusetts Avenue, Cambridge, MA 02139, United States e-mail: devans{at}lecg.com. Andrei Hagiu, Research Institute for the Ministry of Economy Trade and Industry 1-3-1 Kasumigaseki Chiyoda-ku, Tokyo 100-8901, Japan e-mail: ahagiu{at}princeton.edu. Richard Schmalensee, John C Head III Dean, Sloan School of Management, Massachusetts Institute of Technology 50 Memorial Drive, Cambridge, MA 02142, United States e-mail: rschmal{at}mit.edu.

Software platforms are a critical component of the computer systems underpinning leading-edge products ranging from third-generation mobile phones to video games. After describing some key economic features of computer systems and software platforms, the paper presents case studies of personal computers, video games, personal digital assistants, smart mobile phones, and digital content devices. It then compares several economic aspects of these businesses including their industry evolution, pricing structures, and degrees of integration. (JEL L86, L11, L15)


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