The Smartphone as the Incumbent “Thing” among the Internet of Things

Date
2019-01-08
Authors
MacCrory, Frank
Katsamakas, Evangelos
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Abstract
The smartphone has been the ubiquitous computing platform in the past decade. However, emerging consumer Internet of Things (IoT) technology trends, such as smartwatches and smart speakers, promise the establishment of new ubiquitous platforms. We model two competing horizontally-differentiated platforms that each offer a smartphone and another smart device. This market diverges markedly from standard mixed bundling results when devices from the same vendor have super-additive utility. We show that the degree of a smart device’s differentiation (relative to the smartphone) is the prime factor determining if it is profitable to deepen integration between a smart device with the incumbent smartphone platform. We provide managerial insights for technology strategy.
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The Impact of Digitization on Business Operations, Organizational Systems and Technology, Analytical Modeling, Economics of IS, Internet of Things, Mobile Computing, Platforms
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