Article Contents
Article Contents

# Preannouncement strategy of platform-type new product for competing platforms: Technical or marketing information

• * Corresponding author: Tiaojun Xiao

This research is funded by the National Natural Science Foundation of China (No. 71871112) and Jiangsu province's "333 project" training funding project (No. BRA2019040)

• What message should be released to consumers and developers is an important part of the preannouncement strategy of platforms' new product. From the perspectives of consumers and developers' information perceptions, we develop a game model of two-sided market, which can better describe the impacts of information preannouncement on consumers, developers, and platforms behavior in a competitive environment. There are two preannouncement strategies: Technical or marketing information. Our studies reveal that (i) when the development capabilities are heterogeneous enough, both platforms release technical information; (ii) both platforms preannounce marketing information when the heterogeneity of development capability is sufficiently small, even if it decreases total social welfare; (iii) the platform lacking competitive advantage is more inclined to adopt a strategy different from the competitive advantage platform, and competitive advantage platform is likely to change the preannouncement strategy constantly; (iv) the heterogeneity of platforms is the prerequisite for the asymmetric equilibrium, even if it may decrease the overall social welfare.

Mathematics Subject Classification: Primary: 91A10; Secondary: 90B60.

 Citation:

• Figure 1.  Game structure of the PNPP

Figure 2.  (a) SPNE change with $t_{e}$ when $t = 15$ and $f_{e} = 1$ and (b)SPNE change with $f_{e}$ when $t = 1$ and $t_{e} = 15$

Figure 3.  (a) SPNE distribution when $\beta_{b} = 1.01$ and (b)SPNE distribution when $\beta_{b} = 5.01$

Figure 4.  (a) Consumer price changes with $\delta$ and (b)Developer price changes with $\delta$

Figure 5.  (a) SPNE changes with $f_{e}$ when $\delta = 0.2$ and (b)SPNE changes with $f_{e}$ when $\delta = 1.2$

Figure 6.  SPNE changes with $\delta$

Figure 7.  Total social welfare changes with $\delta$

Table 1.  Equilibrium results under $(M, M)$

 Decisions Consumers' price $p_{bi}^{MM}=t+t_{e}+\beta_{b}(1-g)/(4g)-\beta_{b}(2v_{d} +\beta_{b}+3\beta_{d})/(8gc_{d})$ Developers' price $p_{di}^{MM}=[2v_{d}-2c_{d}(1-g)+\beta_{b}-\beta_{d}]/4$ Consumers' number $n_{bi}^{MM}=1/2$ Developers' number $n_{di}^{MM}=[2v_{d}-2c_{d}(1-g)+\beta_{b}+\beta_{d}]/(8gc_{d})$ Equilibrium profits/total utilities Platforms' profit $\Pi_{i}^{MM}=(t+t_{e})/2+(4V_{1}^2-B_{0}-2\beta_{b}\beta_{d})/(32gc_{d})-c_{M}$ Consumers' total utility $BS_{i}^{MM}=[4v_{b}-5(t+t_{e})]/8+[B_{0}+2(\beta_{b}+\beta_{d})V_{1}]/(16gc_{d})$ Developers' total utility $DS_{i}^{MM}=(2V_{1}+\beta_{b}+\beta_{d})^2/(64gc_{d})$

Table 2.  Nash equilibrium under $(T, T)$

 Decisions Consumers' price $p_{bi}^{TT}=t+\beta_{b}(1-g)/(4g)-\beta_{b}[2(v_{d}+f_{e}) +\beta_{b}+3\beta_{d}]/(8gc_{d})$ Developers' price $p_{di}^{TT}=(2v_{d}-2c_{d}+2c_{d}g+2f_{e}+\beta_{b}-\beta_{d})/4$ Consumers' number $n_{bi}^{TT}=1/2$ Developers' number $n_{di}^{TT}=[2v_{d}+2f_{e}+\beta_{b}+\beta_{d}-2c_{d}(1-g)]/(8gc_{d})$ Equilibrium profits/total utilities Platforms' profit $\Pi_{i}^{TT}=t/2+[4(V_{1}+f_{e})^2-B_{0}-2\beta_{b}\beta_{d}]/(32gc_{d})-c_{T}$ Consumers' total utility $BS_{i}^{TT}=(4v_{b}-5t)/8+[B_{0}+2(\beta_{b}+\beta_{d})(V_{1}+f_{e})]/(16gc_{d})$ Developers' total utility $DS_{i}^{TT}=[2(V_{1}+f_{e})+\beta_{b}+\beta_{d}]^2/(64gc_{d})$

Table 3.  Nash equilibrium under $(M, T)$

 Decisions Consumers' price $p_{bi}^{TT}=t+\beta_{b}(1-g)/(4g)-\beta_{b}[2(v_{d}+f_{e}) +\beta_{b}+3\beta_{d}]/(8gc_{d})$ Developers' price $p_{di}^{TT}=(2v_{d}-2c_{d}+2c_{d}g+2f_{e}+\beta_{b}-\beta_{d})/4$ Consumers' number $n_{bi}^{TT}=1/2$ Developers' number $n_{di}^{TT}=[2v_{d}+2f_{e}+\beta_{b}+\beta_{d}-2c_{d}(1-g)]/(8gc_{d})$ Equilibrium profits/total utilities Platforms' profit $\Pi_{i}^{TT}=t/2+[4(V_{1}+f_{e})^2-B_{0}-2\beta_{b}\beta_{d}]/(32gc_{d})-c_{T}$ Consumers' total utility $BS_{i}^{TT}=(4v_{b}-5t)/8+[B_{0}+2(\beta_{b}+\beta_{d})(V_{1}+f_{e})]/(16gc_{d})$ Developers' total utility $DS_{i}^{TT}=[2(V_{1}+f_{e})+\beta_{b}+\beta_{d}]^2/(64gc_{d})$

Table 4.  Factors of effect asymmetric strategy to be a SPNE

 $t=1$ $c_{d}=1$ $c_{d}$ $\hat{f}_{e1}$ $\hat{f}_{e2}$ $\hat{f}_{e2}-\hat{f}_{e1}$ $t$ $\hat{f}_{e1}$ $\hat{f}_{e2}$ $\hat{f}_{e2}-\hat{f}_{e1}$ 1 0.31 0.61 0.30 1 0.31 0.61 0.30 3 0.93 1.72 0.79 3 0.34 0.58 0.24 5 1.52 2.74 1.22 5 0.36 0.56 0.20 7 2.08 3.69 1.61 7 0.37 0.54 0.17 9 2.62 4.59 1.96 9 0.38 0.53 0.15

Table 5.  Nash equilibrium of non-identical platforms

 $(M, M)$ $(T, T)$ $p_{bi, E}^{MM}=p_{bi}^{MM}-3\beta_{b}(v_{di}-v_{d})/(12gc_{d})$ $-F(i)[(\beta_{b}+2\beta_{d})E_{2}/(24gc_{d}W_{1})-E_{3}/(12gc_{d})]$ $p_{bi, E}^{TT}=p_{bi}^{TT}-3\beta_{b}(v_{di}-v_{d})/(12gc_{d})$ $-F(i)[(\beta_{b}+2\beta_{d})E_{2}/(24gc_{d}W_{2})-E_{3}/(12gc_{d})]$ $p_{di, E}^{MM}=p_{di}^{MM}+F(i)E_{2}/W_{1}+(v_{di}-v_{d})/2$ $p_{di, E}^{TT}=p_{di}^{TT}+F(i)E_{2}/(4W_{2})+(v_{di}-v_{d})/2$ $n_{bi, E}^{MM}=n_{bi}^{MM}+F(i)E_{3}/W_{1}$ $n_{bi, E}^{TT}=n_{bi}^{TT}+F(i)E_{3}/W_{2}$ $n_{di, E}^{MM}=n_{di}^{MM}+F(i)E_{4}/W_{1}+(v_{di}-v_{d})/(4gc_{d})$ $n_{di, E}^{TT}=n_{di}^{TT}+F(i)E_{4}/W_{2}+(v_{di}-v_{d})/(4gc_{d})$ $\Pi_{i, E}^{MM}=\Pi_{i}^{MM}+E_{2}^2/(96gc_{d}W_{1}^2)+E_{3}^2/(24gc_{d}W_{1})$ $+F(i)E_{3}(\beta_{b}-\beta_{d})^2/(48gc_{d}W_{1})+E_{3}/(12gc_{d})$ $+[(v_{di}+v_{d})-2c_{d}+2c_{d}g](v_{di}-v_{d})/(8gc_{d})$} $\Pi_{i, E}^{TT}=\Pi_{i}^{TT}+E_{2}^2/(96gc_{d}W_{1}^2)+E_{3}^2/(24gc_{d}W_{1})$ $+F(i)E_{3}(\beta_{b}+\beta_{d})^2/(48gc_{d}W_{1})+E_{3}/(12gc_{d})$ $+[(v_{di}+v_{d})-2c_{d}+2c_{d}g](v_{di}-v_{d})/(8gc_{d})$} $(M, T)$ $p_{bi, E}^{MT}=p_{bi}^{MT}-\beta_{b}(v_{di}-v_{d})/(4gc_{d})-F(i)E_{3}(B_{2}-2W_{3})/(24gc_{d}W_{3})$ $p_{di, E}^{MT}=p_{di}^{MT}+F(i)E_{2}/(4W_{3})+(v_{di}-v_{d})/2$ $n_{bi, E}^{MT}=n_{bi}^{MT}+F(i)E_{3}/(2W_{3})$ $n_{di, E}^{MT}=n_{di}^{MT}+F(i)E_{4}/W_{3}+(v_{di}-v_{d})/(4gc_{d})$ $\Pi_{1, E}^{MT}=\Pi_{1}^{MT}+(\beta_{b}-\beta_{d})^2E_{3}(E_{3}-2R_{2})/(96gc_{d}W_{3}^2)+[8E_{3}+12(2v_{d}+\delta-2\phi)\delta]/(96gc_{d})$ $-(\beta_{b}+\beta_{d})\delta[8gc_{d}t_{e}+4f_{e}(\beta_{b}+\beta_{d})-(\beta_{b}-\beta_{d})^2-2E_{3}]/(48gc_{d}W_{3})$ $\Pi_{2, E}^{MT}=\Pi_{2}^{MT}+(\beta_{b}-\beta_{d})^2E_{3}(E_{3}-2R_{2})/(96gc_{d}W_{3}^2)+[8E_{3}+12(2v_{d}-\delta-2\phi+2f_{e})\delta]/(96gc_{d})$ $+(\beta_{b}+\beta_{d})\delta[8gc_{d}t_{e}+4f_{e}(\beta_{b}+\beta_{d})+(\beta_{b}-\beta_{d})^2-2E_{3}]/(48gc_{d}W_{3})$ $(T, M)$ $\Pi_{1, E}^{TM}=\Pi_{1, E}^{MT}+[3f_{e}^2+8gc_{d}t_{e}+f_{e}(6\delta+6V_1+4\beta_{b}+4\beta_{d})]/(24gc_{d})+(\beta_{b}-\beta_{d})R_{2}E_{4}/(3W_{3}^2)$ $+R_{2}[8\delta(\beta_{b}+\beta_{d})+(\beta_{b}-\beta_{d})^2]/(24gc_{d}W_{3})$}} $\Pi_{2, E}^{TM}=\Pi_{2, E}^{MT}-[3f_{e}^2+8gc_{d}t_{e}+f_{e}(6\delta+6V_1+4\beta_{b}+4\beta_{d})]/(24gc_{d})+(\beta_{b}-\beta_{d})R_{2}E_{4}/(3W_{3}^2)$ $+R_{2}[(\beta_{b}-\beta_{d})^2-8\delta(\beta_{b}+\beta_{d})]/(24gc_{d}W_{3})$

Table 1A.  Mathematical abbreviation and threshold

 $V_{1}=v_{d}-c_{d}(1-g)$ $B_{0}=\beta_{b}^2+\beta_{d}^2+4\beta_{b}\beta_{d}$ $B_{1}=\beta_{b}^2+\beta_{d}^2+6\beta_{b}\beta_{d}$ $\phi=c_{d}(1-g)$ $R_{1}=\beta_{b}^2-2\beta_{d}^2+\beta_{b}\beta_{d}$ $R_{2}=f_{e}(\beta_{b}+\beta_{d})+2gc_{d}t_{e}$ $R_{3}=24gc_{d}(c_{T}-c_{M})-6f_{e}[v_{d}-c_{d}(1-g)]$ $+2gc_{d}t_{e}-f_{e}(3f_{e}+2\beta_{b}+2\beta_{d})$ $R_{4}=f_{e}(\beta_{b}+\beta_{d})+5gc_{d}t_{e}$ $R_{5}=6(\beta_{b}+\beta_{d})(2v_{d}-2c_{d}+2c_{d}g+f_{e})$ $+48gc_{d}v_{b}+2\beta_{b}^2+8\beta_{b}\beta_{d}+\beta_{d}^2$ $R_{6}=2v_{d}-2c_{d}(1-g)+f_{e}+\beta_{b}+\beta_{d}$ $R_{7}=f_{e}(\beta_{b}+\beta_{d})+8gc_{d}t_{e}$ $E_{2}=2\delta(\beta_{b}^2-\beta_{d}^2)$ $E_{3}=2\delta(\beta_{b}+\beta_{d})$ $E_{4}=2\delta(\beta_{b}+\beta_{d})^2/(8gc_{d})$ $E_{5}=2v_{d}+\beta_{b}+\beta_{d}$ $W_{1}=12gc_{d}(t+t_{e})-(\beta_{b}^2+\beta_{d}^2+4\beta_{b}\beta_{d})$ $W_{2}=12gc_{d}t-(\beta_{b}^2+\beta_{d}^2+4\beta_{b}\beta_{d})$ $W_{3}=6gc_{d}(2t+t_{e})-(\beta_{b}^2+\beta_{d}^2+4\beta_{b}\beta_{d})$ $H_{1}=[6f_{e}V_{1}+3f_{e}^2+2f_{e}(\beta_{b}+\beta_{d})$ $-2gc_{d}t_{e}]/(24gc_{d})$} $H_{2}=R_{2}[4gc_{d}t_{e}-(\beta_{b}-\beta_{d})^2$ $+2f_{e}(\beta_{b}+\beta_{d})]/(48gc_{d}W_{3})$} $H_{3}=R_{2}[4gc_{d}t_{e}+(\beta_{b}-\beta_{d})^2$ $+2f_{e}(\beta_{b}+\beta_{d})]/(48gc_{d}W_{3})$} $H_{4}=R_{2}^2(\beta_{b}-\beta_{d})^2/(96gc_{d}W_{3}^2)$ Threshold $\hat{t}^{MM}=\beta_{b}\beta_{d}/(2gc_{d})-t_{e}$ $\hat{t}^{MT}=\beta_{b}\beta_{d}/(2gc_{d})-t_{e}/2$ $\hat{t}^{TT}=\beta_{b}\beta_{d}/(2gc_{d})$ $\hat{t}_{e7}=-(1+g)f_{e}(2\phi+f_{e}+E_{5})/(gc_{d})$ $\hat{f}_{e7}=\{2\phi-2v_{d}-\beta_{b}-\beta_{d}+\sqrt{(1+g)[(1+g)(E_{5}-2\phi)^2-4gc_{d}t_{e}]}/(1+g)\}/2$

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