Author Abstract
We examine two episodes of strategic interaction in the UK betting industry: (i) Betfair (an entrant multisided platform or MSP) vs. Flutter (also an MSP), and (ii) Betfair vs. traditional bookmakers. We find that although Betfair was an underfunded second mover in the betting exchange space, it was able to attract punters at a much faster rate than the better-funded first mover, Flutter. Moreover, while Betfair and traditional bookmakers competed aggressively for market share, they also developed a highly complementary relationship that favored all parties. We discuss implications for research in the economics and management of MSPs. Specifically, we argue that the literature would benefit from work that endogenizes platform design and that considers the possible competitive and cooperative interactions between the business models of traditional incumbents and those of potential innovative MSP entrants.
Paper Information
- Full Working Paper Text
- Working Paper Publication Date: November 2018
- HBS Working Paper Number: HBS Working Paper #19-057
- Faculty Unit(s): Strategy
