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Analyzing the Influence of Complementors’ Quantity and Diversity on Platform Adoption

Vahedi, Maral | 2024

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  1. Type of Document: M.Sc. Thesis
  2. Language: Farsi
  3. Document No: 57971 (44)
  4. University: Sharif University of Technology
  5. Department: Management and Economics
  6. Advisor(s): Miremadi, Iman; Talebian, Masoud
  7. Abstract:
  8. This study examines the relationship between the number and diversity of complementary products and the success of video game platforms. The primary question of this research is why platforms like the PlayStation 5 have achieved widespread success, while other lesser-known platforms have faced failure. Do the depth and breadth of complementary products offered on platforms, as suggested by theories in the platform literature, explain this success? The findings of this research can help companies in the video game industry and related sectors better understand the factors influencing platform success and make more targeted investments in complementary products. Furthermore, this study holds particular significance in the highly profitable video game industry, which is valued at over 200 billion dollars and is larger than the combined film, television, and music industries. To address these questions, data were collected from two credible sources: game information from the VGChartz website and console data from the NPD Group. Analysis of this data indicates that an increase in the number and variety of games released on a console directly leads to an increase in its monthly sales, with no optimal point for the number and variety of games. In other words, the greater the number and diversity of video games released for a console, the higher the chance of that console's success. This phenomenon can be linked to the network effect, which indirectly ties the value of a product to the number of its complementary products. The fixed regression coefficients also show that the number of complementary products released has a greater impact on platform sales compared to the diversity of complementary products. The findings of this research are consistent with existing theoretical concepts regarding network effects and provide a deeper understanding of optimal strategies in the video game industry. This information is highly valuable for developers of complementary products and platform owners, whether they are newcomers or experienced professionals
  9. Keywords:
  10. Video Games ; Network Effects ; Genre Diversity ; Video Game Platforms ; Complementary Products

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