Andrei Hagiu

Associate Professor of Business Administration

Andrei is an Associate Professor in the Strategy group at Harvard Business School. Andrei's research focuses on multi-sided markets, which feature platforms/intermediaries serving two or more distinct groups of customers, who value each other's participation. He is studying the business strategies used by such platforms and the economic structure of the industries in which they operate: videogames (e.g. OnLive, PlayStation, Wii), e-commerce (e.g. Amazon, eBay, Gazelle, Rakuten), smartphones (e.g. Android, iPhone), personal computers (e.g. Windows, Mac OS), shopping malls (e.g. Roppongi Hills), intellectual property (e.g. Intellectual Ventures, Ocean Tomo, RPX), payment systems (e.g. Edy, PayPal, Suica, Visa), online TV services (e.g. Brightcove, PCCW, PP Live), etc.  Andrei is using the insights derived from this research to advise companies in some of these industries. He is also occasionally involved in competition and industrial policy research and advisory projects in Japan, China, and in the United States.  

Andrei graduated from the Ecole Polytechnique and the Ecole Nationale de la Statistique et Adminstration Economique in France with an MS in economics and statistics, before obtaining a PhD in economics from Princeton University.  Prior to joining HBS, he spent 18 months in Tokyo as a fellow at the Research Institute of Economy Trade and Industry, an economic policy think-tank affiliated with the Japanese Ministry of Economy Trade and Industry.

Journal Articles

  1. Marketplace or Reseller?

    Intermediaries can choose between functioning as a marketplace (on which suppliers sell their products directly to buyers) or as a reseller (purchasing products from suppliers and selling them to buyers). We model this as a decision between whether control rights over a non-contractible decision variable (the choice of some marketing activity) are better held by suppliers (the marketplace-mode) or by the intermediary (the reseller-mode). Whether the marketplace- or the reseller-mode is preferred depends on whether independent suppliers or the intermediary have more important information relevant to the optimal tailoring of marketing activities for each specific product. We show that this tradeoff is shifted towards the reseller-mode when marketing activities create spillovers across products and when network effects lead to unfavorable expectations about supplier participation. If the reseller has a variable cost advantage (respectively, disadvantage) relative to the marketplace, then the tradeoff is shifted towards the marketplace for long-tail (respectively, short-tail) products. We thus provide a theory of which products an intermediary should offer in each mode. We also provide some empirical evidence that supports our main results.

    Citation:

    Hagiu, Andrei, and Julian Wright. "Marketplace or Reseller?" Management Science (forthcoming). View Details
  2. Information and Two-Sided Platform Profits

    We study the effect of different levels of information on two-sided platform profits under monopoly and competition. One side (developers) is always informed about all prices and therefore forms responsive expectations. In contrast, we allow the other side (users) to be uninformed about prices charged to developers and to hold passive expectations. We show that platforms with more market power (monopoly) prefer facing more informed users. In contrast, platforms with less market power (i.e., facing more intense competition) have the opposite preference: they derive higher profits when users are less informed. The main reason is that price information leads user expectations to be more responsive and therefore amplifies the effect of price reductions. Platforms with more market power benefit because higher responsiveness leads to demand increases, which they are able to capture fully. Competing platforms are affected negatively because more information intensifies price competition.

    Keywords: two-sided platforms; information; responsive expectations; passive expectations; wary expectations; Information; Performance Expectations; Two-Sided Platforms; Monopoly;

    Citation:

    Hagiu, Andrei, and Hanna Halaburda. "Information and Two-Sided Platform Profits." International Journal of Industrial Organization 34 (May 2014): 25–35. View Details
  3. Search Diversion and Platform Competition

    Platforms use search diversion in order to trade off total consumer traffic for higher revenues derived by exposing consumers to unsolicited products (e.g., advertising). We show that competition between platforms leads to lower equilibrium levels of search diversion relative to a monopoly platform when the intensity of competition is high. On the other hand, if there is only mild competition, then competing platforms induce more search diversion relative to a platform monopolist. When platforms charge consumers fixed access fees, all equilibrium levels of search diversion under platform competition are equal to the monopoly level, irrespective of the nature of competition. Furthermore, relative to platforms that cannot charge such fees, platforms that charge positive (negative) access fees to consumers have weaker (stronger) incentives to divert search.

    Keywords: market intermediation; search; Two-Sided Markets; platform design; platform competition; Competition; Two-Sided Platforms;

    Citation:

    Hagiu, Andrei, and Bruno Jullien. "Search Diversion and Platform Competition." International Journal of Industrial Organization 33 (March 2014): 48–60. View Details
  4. Strategic Decisions for Multisided Platforms

    Multisided platforms such as eBay and Facebook create value by enabling interactions between two or more customer groups. But building and managing a winning platform isn’t easy.

    Keywords: Value Creation; Multi-Sided Platforms; Business Strategy;

    Citation:

    Hagiu, Andrei. "Strategic Decisions for Multisided Platforms." MIT Sloan Management Review 55, no. 2 (Winter 2014). View Details
  5. Do You Really Want to Be an eBay?

    Most companies that serve as intermediaries between buyers and sellers face a fundamental strategy decision: Should they be resellers (like supermarkets), acquiring and then reselling products or services? Should they operate as multisided platforms (like eBay), connecting buyers and sellers without controlling or owning the offerings being sold? Or should they blend the two models?

    Keywords: strategy; multi-sided platforms; business models; Strategy; Multi-Sided Platforms; Technology Platform;

    Citation:

    Hagiu, Andrei, and Julian Wright. "Do You Really Want to Be an eBay?" Harvard Business Review 91, no. 3 (March 2013): 102–108. View Details
  6. The New Patent Intermediaries: Platforms, Defensive Aggregators and Super-Aggregators

    The patent market consists mainly of privately negotiated, bilateral transactions, either sales or cross-licenses, between large companies. There is no eBay, Amazon, New York Stock Exchange, or Kelley's Blue Book equivalent for patents, and when buyers and sellers do manage to find each other, they usually negotiate under enormous uncertainty: prices of similar patents vary widely from transaction to transaction, and the terms of the transactions (including prices) are often secret and confidential. Inefficient and illiquid markets, such as the one for patents, generally create profit opportunities for intermediaries. We begin with an overview of the problems that arise in patent markets, and how traditional institutions like patent brokers, patent pools, and standard-setting organizations have sought to address them. During the last decade, a variety of novel patent intermediaries have emerged. We discuss how several online platforms have started services for buying and selling patents but have failed to gain meaningful traction. And new intermediaries that we call defensive patent aggregators and super-aggregators have become quite influential and controversial in the technology industries they touch. The goal of this paper is to shed light on the role and efficiency tradeoffs of these new patent intermediaries. Finally, we offer a provisional assessment of how the new patent intermediary institutions affect economic welfare.

    Keywords: intellectual property; patents; platforms; intermediaries; aggregator; Patents; Market Platforms; Marketplace Matching; Distribution Channels;

    Citation:

    Hagiu, Andrei, and David B. Yoffie. "The New Patent Intermediaries: Platforms, Defensive Aggregators and Super-Aggregators." Journal of Economic Perspectives 27, no. 1 (Winter 2013): 45–66. View Details
  7. First-Party Content and Coordination in Two-Sided Markets

    The strategic use of first-party content by two-sided platforms is driven by two key factors: the nature of buyer and seller expectations (favorable versus unfavorable) and the nature of the relationship between first-party content and third-party content (complements or substitutes). Platforms facing unfavorable expectations face an additional constraint: their prices and first-party content investment need to be such that low (zero) participation equilibria are eliminated. This additional constraint typically leads them to invest more (less) in first-party content relative to platforms facing favorable expectations when first- and third-party content are substitute (complements). These results hold with both simultaneous and sequential entry of the two sides. With two competing platforms—incumbent facing favorable expectations and entrant facing unfavorable expectations—and multi-homing on one side of the market, the incumbent always invests (weakly) more in first-party content relative to the case in which it is a monopolist.

    Keywords: two-sided platforms; platform strategy; technology; Technology; Performance Expectations; Strategy; Two-Sided Platforms;

    Citation:

    Hagiu, Andrei, and Daniel Spulber. "First-Party Content and Coordination in Two-Sided Markets." Management Science 59, no. 4 (April 2013): 933–949. View Details
  8. Why Do Intermediaries Divert Search?

    We analyze the incentives to divert search for an information intermediary who enables buyers (consumers) to search affiliated sellers (stores). We identify two original motives for diverting search (i.e., inducing consumers to search more than they would like): 1) trading off higher total consumer traffic for higher revenues per consumer visit and 2) influencing stores' choices of strategic variables (e.g., pricing). We characterize the conditions under which there would be no role for search diversion as a strategic instrument for the intermediary, thereby showing that it occurs even when the contracting space is significantly enriched. We then discuss several applications related to online and brick-and-mortar intermediaries.

    Keywords: market intermediation; search; Two-Sided Markets; platform design; Demand and Consumers; Motivation and Incentives; Online Technology; Search Technology; Two-Sided Platforms; Distribution Channels; Business Strategy; Retail Industry;

    Citation:

    Hagiu, Andrei, and Bruno Jullien. "Why Do Intermediaries Divert Search?" RAND Journal of Economics 42, no. 2 (summer 2011): 337–362. (2012 Winner for Best Paper on Competition Economics, Association of Competition Economics.) View Details
  9. Exclusivity and Control

    We analyze platform competition for content in the presence of strategic interactions between content distributors and content providers. We provide a model of bargaining and price competition within these industries and show that whether or not a piece of content ends up exclusive to one platform depends crucially on whether or not the content provider maintains control over the pricing of its own good. If the content provider sells its content outright and relinquishes control over its price, the content will tend to be exclusive unless there are sufficient market expansion effects. On the other hand, if the content provider maintains control of its pricing, the strategic interaction between prices set by the content provider and by the platforms leads to a non-monotonic relationship between exclusivity and content quality: both high and low quality content will multihome and join both platforms, but there will be a range of quality for which content will be exclusive despite foreclosing itself from selling to a portion of the market. In addition, we show that contrary to standard results on double marginalization and pricing of complementary goods, a platform that already has exclusive access to content may prefer to relinquish control over pricing and associated revenues from the content to the content provider in order to reduce price competition at the platform level.

    Keywords: general strategy; entertainment and leisure; software; Quality; Competition; Price; Sales; Expansion; Market Platforms; Revenue; Negotiation;

    Citation:

    Hagiu, Andrei, and Robin S. Lee. "Exclusivity and Control." Journal of Economics & Management Strategy 20, no. 3 (Fall 2011). View Details
  10. What's Your Google Strategy?

    Keywords: Web; Strategy; Information;

    Citation:

    Hagiu, Andrei, and David B. Yoffie. "What's Your Google Strategy?" Harvard Business Review 87, no. 4 (April 2009). View Details
  11. Two-Sided Platforms: Product Variety and Pricing Structures

    This paper provides a new modeling framework to analyze two-sided platforms connecting producers and consumers. In contrast to the existing literature, indirect network effects are determined endogenously, through consumers' taste for variety and producer competition. Three new aspects of platform pricing structures are derived. First, the optimal platform pricing structure shifts towards extracting more rents from producers relative to consumers when consumers have stronger demand for variety, since producers become less substitutable. With platform competition, consumer preferences for variety, producer market power and producer economies of scale in multihoming also make platforms' price-cutting strategies on the consumer side less effective. This second effect on equilibrium pricing structures goes in the opposite direction relative to the first one. Third, variable fees charged to producers can serve to trade off producer innovation incentives against the need to reduce a platform holdup problem.

    Keywords: two-sided platforms; pricing structure; indirect network effects; product variety; Price; Network Effects; Two-Sided Platforms; Product; Renting or Rental; Competition;

    Citation:

    Hagiu, Andrei. "Two-Sided Platforms: Product Variety and Pricing Structures." Journal of Economics & Management Strategy 18, no. 4 (December 2009). View Details
  12. Merchant or Two-Sided Platform?

    This paper provides a first pass at clarifying the economic tradeoffs between two polar strategies for market intermediation: the "merchant" mode, in which the intermediary buys from sellers and resells to buyers; and the "two-sided platform" mode, under which the intermediary enables affiliated sellers to sell directly to affiliated buyers. The merchant mode yields higher profits than the two-sided platform mode when the chicken-and-egg problem due to indirect network effects for the two-sided platform mode is more severe and when the degree of complementarity/substitutability among sellers' products is higher. Conversely, the platform mode is preferred when seller investment incentives are important or when there is asymmetric information regarding seller product quality. We discuss these tradeoffs in the context of several prominent digital intermediaries.

    Keywords: merchants; two-sided platforms; intermediaries; Two-Sided Markets; Technology Platform;

    Citation:

    Hagiu, Andrei. "Merchant or Two-Sided Platform?" Review of Network Economics 6, no. 2 (June 2007): 115–133. View Details
  13. A Staged Solution to the Catch-22

    Companies looking to launch a two-sided platform—between, for example, credit card users and merchants, or search engine users and advertisers—must overcome the reluctance of one side to sign on until it's confident the other side will be well populated. It's a common business quandary, but Google and Charles Schwab both found a way around it.

    Keywords: Risk and Uncertainty; Social Psychology; Two-Sided Platforms;

    Citation:

    Hagiu, Andrei, and Thomas Eisenmann. "A Staged Solution to the Catch-22." Harvard Business Review 85, no. 11 (November 2007). View Details
  14. Pricing and Commitment by Two-Sided Platforms

    Keywords: Price; Two-Sided Platforms;

    Citation:

    Hagiu, Andrei. "Pricing and Commitment by Two-Sided Platforms." RAND Journal of Economics 37, no. 3 (fall 2006). View Details

Book Chapters

  1. Network Effects

    Network effects are a key economic and strategic phenomenon in 'new economy' industries. They can, but do not necessarily, lead to market tipping, unless they outweigh customers' benefits from differentiation and are accompanied by high switching and multi-homing costs. Network effects create the possibility for multiple equilibrium market configurations, which are crucially determined by market participants' EXPECTATIONS. While in some markets network effects are exogenously given, in other markets their existence and magnitude is endogenously determined by firms' strategic choices.

    Keywords: Network Effects;

    Citation:

    Hagiu, Andrei, and David B. Yoffie. "Network Effects." In The Palgrave Encyclopedia of Strategic Management, edited by Mie Augier and David J. Teece. Palgrave Macmillan, forthcoming. (Published online October 2013.) View Details
  2. Software Platforms

    Citation:

    Hagiu, Andrei. "Software Platforms." Chap. 3 in The Oxford Handbook of the Digital Economy, edited by Martin Peitz and Joel Waldfogel. Oxford University Press, 2012. View Details
  3. Platform Rules: Multi-Sided Platforms As Regulators

    This chapter provides a basic conceptual framework for interpreting non-price instruments used by multi-sided platforms (MSPs) by analogizing MSPs as "private regulators" who regulate access to and interactions around the platform. We present evidence on Facebook, TopCoder, Roppongi Hills, and Harvard Business School to document the "regulatory" role played by MSPs. We find MSPs use nuanced combinations of legal, technological, informational, and other instruments (including price-setting) to implement desired outcomes. Non-price instruments were very much at the core of MSP strategies.

    Keywords: Price; Governing Rules, Regulations, and Reforms; Multi-Sided Platforms; Strategy;

    Citation:

    Boudreau, Kevin J., and Andrei Hagiu. "Platform Rules: Multi-Sided Platforms As Regulators." In Platforms, Markets and Innovation. Paperback ed. Edited by Annabelle Gawer. Cheltenham, U.K. and Northampton, MA: Edward Elgar Publishing, 2009, Paperback. View Details

Working Papers

  1. Search Diversion and Platform Competition Online Appendix

    Citation:

    Hagiu, Andrei, and Bruno Jullien. "Search Diversion and Platform Competition Online Appendix." Harvard Business School Working Paper, No. 14-072, February 2014. View Details
  2. Multi-Sided Platforms

    The economics of two-sided markets or multi-sided platforms has emerged over the past decade as one of the most active areas of research in economics and strategy. The literature has constantly struggled, however, with a lack of agreement on a proper definition: for instance, some existing definitions imply that retail firms such as grocers, supermarkets and department stores are multi-sided platforms (MSPs). We propose a definition which provides a more precise notion of MSPs by requiring that they enable direct interactions between the multiple customer types which are affiliated to them. Several important implications of this new definition are derived. First, cross-group network effects are neither necessary nor sufficient for an organization to be a MSP. Second, our definition emphasizes the difference between MSPs and alternative forms of intermediation such as "re-sellers" which take control over the interactions between the various sides, or input suppliers which have only one customer group affiliated as opposed to multiple. We discuss a number of examples that illustrate the insights that can be derived by applying our definition. Third, we point to the economic considerations that determine where firms choose to position themselves on the continuum between MSPs and resellers, or MSPs and input suppliers.

    Keywords: Customers; Economics; Network Effects; Multi-Sided Platforms; Two-Sided Platforms; Supply Chain; Strategy; Retail Industry;

    Citation:

    Hagiu, Andrei, and Julian Wright. "Multi-Sided Platforms." Harvard Business School Working Paper, No. 12-024, October 2011. View Details
  3. Quantity vs. Quality: Exclusion by Platforms with Network Effects

    This paper provides a simple model of platforms with direct network effects, in which users value not just the quantity (i.e., number) of other users who join, but also their average quality in some dimension. A monopoly platform is more likely to exclude low-quality users when users place more value on average quality and less value on total quantity. With competing platforms, the effect of user preferences for quantity is reversed. Furthermore, exclusion incentives depend in a non-trivial way on the proportion of high-quality users in the overall population and on their opportunity cost of joining the platform relative to low-quality users. The net effect of these two parameters depends on whether they have a stronger impact on the gains from exclusion (higher average quality) or on its costs (lower quantity).

    Keywords: multi-sided platforms; Network Effects; exclusion; quality and quantity; Cost; Governing Rules, Regulations, and Reforms; Network Effects; Market Participation; Market Platforms; Monopoly; Quality; Motivation and Incentives; Strategy;

    Citation:

    Hagiu, Andrei. "Quantity vs. Quality: Exclusion by Platforms with Network Effects." Harvard Business School Working Paper, No. 11-125, May 2011. View Details
  4. Capitalizing On Innovation: The Case of Japan

    Japan's industrial landscape is characterized by hierarchical forms of industry organization, which are increasingly inadequate in modern sectors, where innovation relies on platforms and horizontal ecosystems of firms producing complementary products. Using three case studies—software, animation and mobile telephony—we illustrate two key sources of inefficiencies that this mismatch can create, all the while recognizing that hierarchical ecosystems have played a major role in Japan's success in manufacturing-driven industries (e.g. Toyota in automobiles and Nintendo with videogames). First, hierarchical industry organizations can "lock out" certain types of innovation indefinitely by perpetuating established business practices. For example, the strong hardware and manufacturing bias and hierarchical structures of Japan's computer and electronics firms is largely responsible for the virtual non-existence of a standalone software sector. Second, even when the vertical hierarchies produce highly innovative sectors in the domestic market, the exclusively domestic orientation of the "hierarchical industry leaders" can entail large missed opportunities for other members of the ecosystem, who are unable to fully exploit their potential in global markets. For example, Japan's advanced mobile telecommunications systems (services as well as handsets) suffer from a "Galapagos effect"—like the unique fauna of these remote islands they are only found in the Japanese archipelago. Similarly, while Japanese anime is renowned worldwide for its creativity, there is no global Japanese anime content producer comparable to Disney or Pixar. Instead, anime producers are locked into a highly fragmented domestic market, dominated by content distributors (TV stations and DVD companies) and advertising agencies.

    We argue that Japan has to adopt legislation in several areas in order to address these inefficiencies and capitalize on its innovation: strengthening antitrust and intellectual property rights enforcement; improving the legal infrastructure (e.g. producing more corporate lawyers); lowering barriers to entry for foreign investment and facilitating the development of the venture capital sector.

    Keywords: Globalized Markets and Industries; Government Legislation; Innovation and Invention; Industry Structures; Horizontal Integration; Vertical Integration; Manufacturing Industry; Japan;

    Citation:

    Dujarric, Robert, and Andrei Hagiu. "Capitalizing On Innovation: The Case of Japan." Harvard Business School Working Paper, No. 09-114, April 2009. (Revised October 2009.) View Details
  5. Why Do Intermediaries Divert Search? - Companion Paper

    This companion paper contains several extensions of the model presented in our main paper - Hagiu and Jullien (2009).

    Keywords: market intermediation; search; two sided markets; platform design; Demand and Consumers; Motivation and Incentives; Online Technology; Search Technology; Two-Sided Platforms; Distribution Channels; Business Strategy; Retail Industry;

    Citation:

    Hagiu, Andrei, and Bruno Jullien. "Why Do Intermediaries Divert Search? - Companion Paper." Harvard Business School Working Paper, No. 09-092, February 2009. View Details
  6. Strategic Interactions in Two-Sided Market Oligopolies

    Strategic interactions between two-sided platforms depend not only on whether their decision variables are strategic complements or substitutes as for one-sided firms, but also -and crucially so- on whether or not the platforms subsidize one side of the market in equilibrium. For example, with prices being strategic complements across platforms, we show that a cost-reducing investment by one firm may have a positive effect on its rival's profits and a negative effect on its own profits when one side is subsidized in equilibrium. By contrast, if platforms make positive margins on both sides, the same investment has the regular, expected effects. Our analysis implies that the strategy space and the logic of competitive advantage are fundamentally different in two-sided markets relative to one-sided markets.

    Keywords: Two-Sided Markets; two-sided platforms; strategic complements; strategic substitutes; competitive advantage; Cost; Investment; Profit; One-Sided Platforms; Two-Sided Platforms; Duopoly and Oligopoly; Competitive Advantage;

    Citation:

    Farhi, Emmanuel, and Andrei Hagiu. "Strategic Interactions in Two-Sided Market Oligopolies." Harvard Business School Working Paper, No. 08-011, August 2007. (Revised February 2009.) View Details
  7. Multi-Sided Platforms: From Microfoundations to Design and Expansion Strategies

    Multi-sided platforms (MSPs), which bring together two or more interdependent groups of customers, have recently risen to economic and business prominence in many industries. This paper first lays out a simple micro-founded framework which aims to organize academic and managerial thinking about MSPs. It argues that any MSP performs one or both among two fundamental functions: reducing search costs and reducing shared transaction costs among its multiple sides. Using a variety of illustrations, the framework is then used to formulate general principles driving MSP design and expansion strategies: choosing the relevant platform "sides", deciding which fundamental activities to perform and trading off depth against scope of MSP functions.

    Keywords: Multi-Sided Platforms;

    Citation:

    Hagiu, Andrei. "Multi-Sided Platforms: From Microfoundations to Design and Expansion Strategies." Harvard Business School Working Paper, No. 07-094, May 2007. View Details
  8. Proprietary vs. Open Two-Sided Platforms and Social Efficiency

    This paper identifies a fundamental economic welfare tradeoff between two-sided open platforms and two-sided proprietary (closed) platforms connecting consumers and producers. Proprietary platforms create two-sided deadweight losses through monopoly pricing but at the same time, precisely because they set prices in order to maximize profits, they partially internalize two-sided positive indirect network effects and direct competitive effects on the producer side. We show that this can sometimes make proprietary platforms more socially desirable than open platforms, which runs against the common intuition that open platforms are more efficient. By the same token, inter-platform competition may also turn out to be socially undesirable because it may prevent platforms from sufficiently internalizing indirect externalities and direct intra-platform competitive effects.

    Keywords: Two-Sided Markets; platforms; indirect network effects; product variety; social efficiency; Two-Sided Platforms; Network Effects; Welfare or Wellbeing;

    Citation:

    Hagiu, Andrei. "Proprietary vs. Open Two-Sided Platforms and Social Efficiency." Harvard Business School Working Paper, No. 07-095, May 2007. View Details

Cases and Teaching Materials

  1. Investing in Online Marketplaces

    Simon Rothman had recently been promoted from executive-in-residence to Partner at esteemed venture capital firm Greylock Partners and placed in charge of managing a $100 million early-stage fund commitment dedicated to online marketplaces. In Greylock’s view, 2014 was a special moment in time for online marketplaces, the beginning of a boom in the space that was being catalyzed by mobile technology and social identity. Rothman was the right man for the job. An early eBay employee, he had founded eBay Motors and turned it into a multi-billion dollar business and also advised several successful online marketplaces such as Lyft, Wanelo and TaskRabbit. For his first investment as Partner, Rothman was particularly interested in the food delivery space, which was ripe for disruption by online marketplaces. Rothman had five food delivery startup options to choose from, a philosophy on how to analyze marketplace businesses, and a few weeks to make his first ever investment as a Partner at Greylock.

    Keywords: business models; competitive advantage; entrepreneurship; internet; Investments; networks; technology; venture capital;

    Citation:

    Hagiu, Andrei, and Hermes Alvarez. "Investing in Online Marketplaces." Harvard Business School Case 714-520, June 2014. View Details
  2. Bitcoin: The Future of Digital Payments?

    Citation:

    Hagiu, Andrei, and Nathan Beach. "Bitcoin: The Future of Digital Payments? ." Harvard Business School Case 714-519, June 2014. View Details
  3. Strategy and Technology

    Citation:

    Hagiu, Andrei. "Strategy and Technology." Harvard Business School Course Overview Note 714-480, March 2014. View Details
  4. IP Intermediaries

    Citation:

    Hagiu, Andrei. "IP Intermediaries." Harvard Business School Module Note 714-478, March 2014. View Details
  5. Multi-Sided Platforms

    Citation:

    Hagiu, Andrei. "Multi-Sided Platforms." Harvard Business School Module Note 714-479, March 2014. View Details
  6. Videogames: Clouds on the Horizon?

    Citation:

    Hagiu, Andrei, and Haris Tabakovic. "Videogames: Clouds on the Horizon?" Harvard Business School Teaching Note 714-500, March 2014. View Details
  7. Getty Images

    Citation:

    Hagiu, Andrei, and Hong Luo. "Getty Images." Harvard Business School Teaching Note 714-476, March 2014. View Details
  8. Intuit QuickBooks: From Product to Platform

    This case focuses on the challenges and opportunities faced by a successful incumbent organization attempting to transform a large portion of its business from a traditionally product-centric operating mode to a platform-based one that leverages network effects to create durable competitive advantage. Strategic questions include the extent to which the organization should invest in platform initiatives, the appropriate resource allocation among various product and platform offerings, and the most beneficial business model for each of a few candidate multi-sided platform initiatives.

    Citation:

    Hagiu, Andrei, and Elizabeth J. Altman. "Intuit QuickBooks: From Product to Platform." Harvard Business School Teaching Note 714-477, March 2014. View Details
  9. Brightcove, Inc.

    Citation:

    Hagiu, Andrei. "Brightcove, Inc." Harvard Business School Teaching Note 714-441, October 2013. (Revised March 2014.) View Details
  10. Intuit QuickBooks: From Product to Platform

    This case focuses on the challenges and opportunities faced by a successful incumbent organization attempting to transform a large portion of its business from a traditionally product-centric operating mode to a platform-based one that leverages network effects to create durable competitive advantage. Strategic questions include the extent to which the organization should invest in platform initiatives, the appropriate resource allocation among various product and platform offerings, and the most beneficial business model for each of a few candidate multi-sided platform initiatives.

    Keywords: Technology Industry;

    Citation:

    Hagiu, Andrei, and Elizabeth J. Altman. "Intuit QuickBooks: From Product to Platform." Harvard Business School Case 714-433, October 2013. (Revised December 2013.) View Details
  11. Multi-Sided Platforms: Foundations and Strategy

    This note offers an analysis of four fundamental strategic decisions and associated tradeoffs that set MSPs apart from other types of businesses (e.g. product firms) and that every MSP entrepreneur and investor should carefully consider. In the last section I also discuss an important boundary condition: when is the MSP business model dominated by related — but distinct — business models?

    Keywords: Multi-Sided Platforms; Strategy; Technology; Technology Industry;

    Citation:

    Hagiu, Andrei. "Multi-Sided Platforms: Foundations and Strategy." Harvard Business School Background Note 714-436, October 2013. View Details
  12. GREE, Inc.

    Keywords: Strategy; Technology; Multi-Sided Platforms; Two-Sided Platforms; Technology Platform; Technology Industry; Japan; United States;

    Citation:

    Hagiu, Andrei, and Masahiro Kotosaka. "GREE, Inc." Harvard Business School Teaching Note 713-524, April 2013. (Revised March 2013.) View Details
  13. Gazelle in 2012

    Keywords: strategy; technology; multi-sided platforms; consumer electronics; Technology Industry; United States;

    Citation:

    Hagiu, Andrei. "Gazelle in 2012." Harvard Business School Teaching Note 713-520, April 2013. (Revised March 2014.) View Details
  14. Getty Images

    Keywords: strategy; technology; Technology; Strategy;

    Citation:

    Hagiu, Andrei, and Hong Luo. "Getty Images." Harvard Business School Case 713-515, March 2013. (Revised March 2014.) View Details
  15. GREE, Inc.

    In 2012, GREE was one of the world's most profitable mobile social gaming companies. Its success in Japan was due both to its in-house games and to the development platform that it offered to third-party game developers. Its biggest challenge was to replicate the success of this two-pronged strategy in international markets, where it had to contend not just with many other game developers (e.g. Zynga), but also with the mobile platform providers themselves (e.g. Apple's iOS and Google's Android).

    Keywords: Strategy; Technology; Japan;

    Citation:

    Hagiu, Andrei, and Masahiro Kotosaka. "GREE, Inc." Harvard Business School Case 713-447, November 2012. (Revised June 2013.) View Details
  16. Intellectual Ventures (B)

    Citation:

    Hagiu, Andrei, and Noah Fisher. "Intellectual Ventures (B)." Harvard Business School Supplement 713-435, October 2012. View Details
  17. Brightcove, Inc. (B)

    Citation:

    Hagiu, Andrei, and Noah Fisher. "Brightcove, Inc. (B)." Harvard Business School Supplement 713-436, October 2012. (Revised March 2014.) View Details
  18. Videogames: Clouds on the Horizon?

    Since the creation of the first videogame systems in the 1970s, the videogame industry has undergone numerous transformations as new technologies and market entrants fundamentally changed the gaming experience of customers. In the early 21st century, customers began accessing games without the use of a physical gaming console, either through their mobile devices, or increasingly, through the "cloud" where customers could play videogames through specially enabled devices without the need for a physical game console or game disk. How might the cloud impact the dynamics of the industry?

    Keywords: strategy; Video Game Industry; Entertainment and Recreation Industry;

    Citation:

    Hagiu, Andrei, and Kerry Herman. "Videogames: Clouds on the Horizon?" Harvard Business School Case 713-424, September 2012. (Revised March 2014.) View Details
  19. Gazelle in 2012

    Gazelle has pioneered a reCommerce intermediation model: it buys used electronics from consumers and resells them on eBay or to wholesalers. Going forward, its two main strategic challenges are 1) deciding how much to rely on partnerships with large retailers for growth and 2) deciding whether to continue as a "merchant," i.e., buying and reselling goods (and thereby taking inventory risk), or to transform itself into a "two-sided platform" connecting sellers and buyers without taking inventory risk.

    Keywords: Business Model; Growth and Development Strategy; Markets; Two-Sided Platforms; Partners and Partnerships; Business Strategy; Retail Industry; Service Industry;

    Citation:

    Hagiu, Andrei, and James Weber. "Gazelle in 2012." Harvard Business School Case 711-446, September 2010. (Revised April 2013.) View Details
  20. Brightcove, Inc. in 2007

    Brightcove, a technology and services provider to content owners in the Internet television field, aimed to become a media distribution company in its own right. On October 30, 2006, it relaunched its Website—and, in effect, its business. With its new, consumer-facing home page, and with new offerings for advertisers and affiliates as well as video publishers, Brightcove sought to build a four-sided business (or "platform") around the rapidly expanding online video industry. Simultaneously, CEO Jeremy Allaire was completing a major funding round that would enable the company to make strategic investments in some or all of several categories: technology, media distribution infrastructure, international expansion, and acquisitions. As Allaire and his fellow executives weighed those options, they confronted competitive threats in multiple quarters, but particularly from YouTube, a hugely popular video-sharing site that online search giant Google had recently acquired. Covers Brightcove's vision for its multi-sided business, its technology offering and early business model, its efforts to shift to a new model based on media distribution, and its chief competitors in that market space.

    Keywords: Competition; Entrepreneurship; Investment; Diversification; Multi-Sided Platforms; Business Strategy; Internet; Business Model; Distribution; Media and Broadcasting Industry; Motion Pictures and Video Industry;

    Citation:

    Hagiu, Andrei, and David B. Yoffie. "Brightcove, Inc. in 2007." Harvard Business School Case 712-424, September 2011. (Revised March 2014.) View Details
  21. Roppongi Hills: City Within a City

    Minoru Mori is the CEO of Mori Building, which has built Roppongi Hills, an ambitious large-scale, mixed-use development in Tokyo, Japan that includes high-end retail, restaurants, hotel, office, library, and art museum. A destination site for tourists and local people, the performance of the development was strong, with the exception of the art museum, which posted losses. Also, the branding efforts by Mori were at odds with other tenants and he needed to manage "the town.” Lastly, another competing development was in the works just blocks away, and Mori needed to determine how to address this new competitor.

    Keywords: Buildings and Facilities; Development Economics; Brands and Branding; Urban Development; Competition; Real Estate Industry; Tokyo;

    Citation:

    Elberse, Anita, Andrei Hagiu, and Masako Egawa. "Roppongi Hills: City Within a City." Harvard Business School Case 707-431, January 2007. (Revised October 2011.) View Details
  22. PureTech Ventures in 2011

    In early May 2011, Daphne Zohar, founder and managing partner of PureTech Ventures, a life science venture creation company in Boston, MA, was reviewing a term sheet she had just received from a venture capital (VC) firm for one of PureTech's portfolio companies. The term sheet was due to expire in a week, but through negotiations of term sheet items, PureTech could probably leave the discussions with the venture firm open for another month. PureTech had a unique position in the life sciences ecosystem. It aimed to tackle important medical needs by translating scientific innovations into commercially viable technologies, and in order to do that optimally, was structured as an operating company that created start-ups rather than a typical venture fund that simply invested in them. The VC term sheet Zohar was considering outlined a Series A funding round for one of PureTech's newly created companies. Meanwhile, Zohar's team was also in discussions with several large pharmaceutical companies that were interested in partnering or even acquiring the company. These discussions were progressing nicely but would not lead to a transaction by the due date set by the VC term sheet (or an additional month from then). The current situation presented her with a unique challenge. Should PureTech accept the "bird in hand" VC term sheet or turn it down and wait for the negotiations with the pharmaceutical companies to play out? The latter route offered the potential for a desirable, near-term partnership, but risked that the negotiations would fall through, in which case PureTech would end up losing both time and the opportunity for near-term external validation of its portfolio company.

    Keywords: Business Ventures; Business Startups; Venture Capital; Investment; Innovation and Invention; Negotiation; Partners and Partnerships; Science-Based Business; Opportunities; Boston;

    Citation:

    Hagiu, Andrei, Cesar Castro, and Sarah Murphy. "PureTech Ventures in 2011." Harvard Business School Case 712-419, August 2011. (Revised October 2011.) View Details
  23. The Last DVD Format War?

    Provides a brief overview of the standards battle between HD-DVD and Blu-ray, focusing on the events that precipitated the Blu-ray victory in early 2008.

    Keywords: Five Forces Framework; Standards; Competitive Strategy; Competitive Advantage; Hardware; Media and Broadcasting Industry; Technology Industry;

    Citation:

    Hagiu, Andrei. "The Last DVD Format War?" Harvard Business School Case 710-443, November 2009. (Revised September 2011.) View Details
  24. Wii Encore?

    Nintendo faced huge difficulties in July 2011. Sony's PlayStation and Microsoft's Xbox had caught up with the innovative motion-sensing controllers of the original Wii. And the new Nintendo 3DS handheld console had experienced a very disappointing start. Moreover, videogame consoles (particularly handheld ones) were facing increasing substitution from online and mobile games played on social networks and/or mobile phones (e.g. Zynga's Farmville). First, could Nintendo come up with a novel and innovative console once again (a Wii Encore) in order to escape head-to-head competition against its two larger rivals (Sony and Microsoft)? Second, how could Nintendo fend off the new substitutes, which were competing for a large portion of its customers?

    Keywords: Competition; Innovation Strategy; Two-Sided Platforms; Brands and Branding; Entertainment and Recreation Industry; Video Game Industry;

    Citation:

    Hagiu, Andrei. "Wii Encore?" Harvard Business School Case 712-416, August 2011. (Revised September 2011.) View Details
  25. Game Time Decision for AppDirect (TN)

    Teaching Note for 712-410.

    Keywords: Information Technology Industry;

    Citation:

    Hagiu, Andrei, Laura Arjona, and Emily Zhang. "Game Time Decision for AppDirect (TN)." Harvard Business School Teaching Note 712-411, July 2011. View Details
  26. Intellectual Property Intermediaries

    During the past 5 to 10 years, several different intermediation business models have emerged for the intellectual property (IP) market. This note describes the most prominent ones: non-practicing entities (or patent trolls), defensive patent aggregators, online IP platforms, live IP auctions and IP exchanges.

    Keywords: Business Model; Intellectual Property; Auctions; Market Platforms; Information Technology; Service Industry;

    Citation:

    Hagiu, Andrei. "Intellectual Property Intermediaries." Harvard Business School Case 711-486, January 2011. (Revised June 2011.) View Details
  27. The Auction for Travelport (A)

    A senior Blackstone director is deciding how aggressively to bid for Travelport, a travel distribution business containing several key services and platforms. Travelport's most important properties were Galileo, one of the top 3 global distribution systems (GDSs), CheapTickets and Orbitz, two online travel agencies. Blackstone was competing in an auction against several other large private equity firms with multi•billion dollar investment funds. The auction was about to enter its final round of bidding, with bids having reached $4 billion in the prior round. The Blackstone director (Schorr) and his team have to make three key judgments regarding Travelport. First, they need to develop a point of view on the structural attractiveness of the travel GDS industry. Secondly, they need to decide whether Travelport was a good business to own and identify the key sources of its value. The Travelport business is composed of many different sub•businesses that play in different parts of the travel value chain and some of these sub•businesses are more strategic than others. Thirdly, like most leveraged buyouts, Travelport will need to support a significant amount of debt as a result of the transaction. Chip and his team need to make a judgment on the stability of Travelport's businesses and its ability to generate consistent, predictable cash flows to service its debt obligations.

    Keywords: Value Creation; Product Positioning; Cost vs Benefits; Private Equity; Leveraged Buyouts; Competitive Advantage; Auctions; Industry Structures; Travel Industry;

    Citation:

    Hagiu, Andrei, and Misha Sanwal. "The Auction for Travelport (A)." Harvard Business School Case 710-474, April 2010. (Revised March 2011.) View Details
  28. Qualcomm Incorporated 2009

    Paul Jacobs, chairman and CEO of Qualcomm Incorporated, smiled as he reflected on the success of Qualcomm's code division multiple access (CDMA) technology. By the summer of 2009, CDMA was the basis for all third generation technologies available for cellular transmissions. However, while Qualcomm seemed poised for growth, Jacobs wondered how successful the company's contributions to new generation technologies would be and if they should aggressively develop their new service offerings into profitable business units.

    Keywords: Business Units; Diversification; Wireless Technology; Growth and Development Strategy; Telecommunications Industry;

    Citation:

    Yoffie, David B., Andrei Hagiu, and Elizabeth A. Kind. "Qualcomm Incorporated 2009." Harvard Business School Case 710-433, October 2009. (Revised March 2011.) View Details
  29. IP Intermediaries & Intellectual Ventures

    Teaching Note for 710423 and 711486.

    Keywords: Intellectual Property; Business Model; Innovation and Invention; Revenue; Sales;

    Citation:

    Hagiu, Andrei. "IP Intermediaries & Intellectual Ventures." Harvard Business School Teaching Note 711-503, March 2011. (Revised March 2014.) View Details
  30. Intellectual Ventures

    Teaching Note for 710423.

    Keywords: Patents; Business Model; Innovation and Invention; Revenue;

    Citation:

    Hagiu, Andrei. "Intellectual Ventures." Harvard Business School Teaching Note 711-502, March 2011. (Revised March 2014.) View Details
  31. Intellectual Ventures

    Intellectual Ventures creates and acquires intellectual property, which it then seeks to monetize through non-exclusive licensing. In early 2009, as an increasing number of companies were trying to position themselves as leading intermediaries in the market for intellectual property, IV was looking for the best business model to become such a leading intermediary. Its model was predicated on making it easy for small inventors to monetize their inventions and IP (by selling it to IV) and then using its scale and aggregate IP portfolio to extract revenues from potential licensees (usually technology companies).

    Keywords: Business Model; Innovation and Invention; Intellectual Property; Rights; Service Operations; Research and Development; Technology; Service Industry;

    Citation:

    Hagiu, Andrei, David B. Yoffie, and Alison Berkley Wagonfeld. "Intellectual Ventures." Harvard Business School Case 710-423, September 2009. (Revised February 2011.) View Details
  32. The Auction for Travelport (B)

    This short case presents the epilogue of The Auction for Travelport (A). Blackstone decided to bid on its own, acquired Travelport for $4.3 billion and subsequently went on to acquire another GDS, Travelspan, for $1.4 billion. It then merged the two GDSs and partially spun off in an IPO its online travel businesses, re-named Orbitz Worldwide; it retained the GDS and wholesale travel businesses. By the end of that year (2006), Blackstone had generated cost savings of $270 million. In 2007 Blackstone also undertook a major capital market transaction with Travelport, issuing a new $1.1 billion Senior Unsecured PIK Term Loan, which allowed Blackstone to take back all of its equity in the transaction. Subsequently, during the financial crisis of 2008 and 2009, Blackstone and Travelport repurchased the majority of the $1.1bn PIK loan and other debt in the open market at prices ranging from 18% to 57% of par value, generating a $610 million gain.

    Keywords: Competitive Advantage; Value Creation; Private Equity; Mergers and Acquisitions; Industry Structures; Initial Public Offering; Capital Markets; Market Transactions; Change; Auctions; Travel Industry;

    Citation:

    Hagiu, Andrei, and Misha Sanwal. "The Auction for Travelport (B)." Harvard Business School Supplement 710-475, April 2010. View Details
  33. PCCW now

    In 2007, PCCW had to formulate a strategy for growth of its successful NOW TV platform and its quadruple play implementation outside of Hong Kong. Launched in September 2003 by PCCW (Hong Kong's largest telecommunications operator), NOW TV had swiftly become the world's most successful commercial IPTV deployment. By the end of June 2007, the service had an installed subscriber base of almost 820,000 and offered a choice of 143 TV channels, 71 of which were exclusive. However, opportunities for growth were inherently limited to Hong Kong (7 million inhabitants), which meant PCCW had to find ways to expand its NOW platform or seek to license parts of it internationally.

    Keywords: Television Entertainment; Growth and Development Strategy; Multi-Sided Platforms; Technology Platform; Media and Broadcasting Industry; Telecommunications Industry; Hong Kong;

    Citation:

    Hagiu, Andrei, and Waishun Lo. "PCCW now." Harvard Business School Case 709-405, July 2008. (Revised January 2010.) View Details
  34. Responding to the Wii?

    After years of gaming console industry leadership, how should Sony respond to the overwhelming success of competitor Nintendo's user-friendly Wii over Sony's high-tech PlayStation 3? It was August 2008 and Kazuo Hirai, chief executive of Sony Computer Entertainment Inc. (SCEI), was contemplating questions from reporters about how Sony planned to respond to Nintendo's Wii console, which was dramatically leading Sony's PlayStation 3 and Microsoft's Xbox 360 consoles in sales. The Wii's supremacy was especially disconcerting to Hirai, given that Sony had dominated the video game industry, and largely defined its course, since 1995. But the tables had turned dramatically in the current generation. Though the Wii was technologically much less advanced than PS3 and Xbox 360, the Wii's ease of use, innovative motion-sensitive controller, and simple but fun games had made the console a hit with all demographics: 9 to 65 years old, male and female. As a result, Nintendo had stolen a march on its two larger rivals by appealing to people who were traditionally not avid video game users. Microsoft's and Sony's more powerful machines remained targeted at the traditional "core gamer" audience: 18 to 34 year old males. Hirai was determined to restore that supremacy, in the current generation or the next. He knew that, whether or not he publicly defined SCEI's strategy as a response to Wii, he had to find a way for his company to deal with the new order of the video game industry that Nintendo had created. In seeking to do so, Hirai might find guidance in the history of the industry, which had been marked by rapid and frequent changes of fortune.

    Keywords: Games, Gaming, and Gambling; Two-Sided Platforms; Industry Structures; Competitive Strategy; Electronics Industry; Video Game Industry;

    Citation:

    Hagiu, Andrei, and Hanna Halaburda. "Responding to the Wii?" Harvard Business School Case 709-448, January 2009. (Revised January 2010.) View Details
  35. VMware, Inc., 2008

    Paul Maritz took the helm of VMware in July 2008, just as the company confronted a radically new competitive environment. Since its founding in 1998, VMware had been the leading provider of virtualization software. Now it faced the kind of threat that every software company dreaded most: Microsoft, the world's largest software maker, was taking direct aim at its core market. As of June 2008, buyers of Microsoft's Windows Server 2008 operating system received a free, bundled version of Hyper-V, an advanced virtualization platform product. Looming over the impending competition between these two companies was the story of the "browser wars," in which Microsoft overwhelmed browser maker Netscape Communications by bundling the Internet Explorer browser with the Windows operating system. Did a similar fate await VMware? Maritz moved quickly and boldly to respond to the Microsoft threat-by deciding to offer a version of VMware's own virtualization platform product for free. But he still had to determine whether VMware's overall strategy was the right one. The case offers an overview of virtualization technology, a brief history of VMware, including descriptions of its acquisition by computer storage giant EMC, its August 2007 IPO, and Maritz's arrival as CEO; a summary of its product lines; a discussion of the ecosystem in which the company operates; and a survey of key competitors, including not only Microsoft, but also Citrix Systems and other providers that use the Xen virtualization platform. Finally, the case offers a description and analysis of several strategic options available to VMware.

    Keywords: History; Technology Platform; Competition; Decision Choices and Conditions; Software; Business Strategy;

    Citation:

    Yoffie, David B., Andrei Hagiu, and Michael Slind. "VMware, Inc., 2008." Harvard Business School Case 709-435, September 2008. (Revised August 2009.) View Details
  36. PlaNet Finance: Broad Scope in Microfinance

    PlaNet Finance was a French NGO providing technical support and training services to microfinance institutions (i.e., institutions providing financial services to the poor) and other microfinance actors, rating of microfinance institutions and management, and advisory services to microfinance investors and investment funds. Furthermore, it was creating a network of microfinance banks through a microfinance holding company. However, in a context of rapid change and explosive growth of the microfinance sector, Jacques Attali, the founder and president, wondered whether PlaNet Finance's scope was sufficiently broad to fulfill its mission or, on the contrary, whether it needed to be narrowed in order to eliminate organizational challenges and external perceptions of conflicts of interest.

    Keywords: Financial Institutions; Microfinance; Growth Management; Networks; Non-Governmental Organizations; Service Industry; France;

    Citation:

    Hagiu, Andrei, and Elena Corsi. "PlaNet Finance: Broad Scope in Microfinance." Harvard Business School Case 708-441, August 2007. (Revised May 2009.) View Details
  37. Ocean Tomo: Building a Market for Intellectual Property (TN)

    Teaching Note for [709404].

    Keywords: Management Teams; Intellectual Property; Valuation; Auctions; Globalized Markets and Industries; Resource Allocation; Banking Industry;

    Citation:

    Coles, Peter A., and Andrei Hagiu. "Ocean Tomo: Building a Market for Intellectual Property (TN)." Harvard Business School Teaching Note 709-478, April 2009. View Details
  38. Responding to the Wii? (TN)

    Teaching Note for [709448].

    Keywords: History; Technological Innovation; Leadership; Competition; Industry Structures; Age Characteristics; Video Game Industry;

    Citation:

    Hagiu, Andrei, and Hanna Halaburda. "Responding to the Wii? (TN)." Harvard Business School Teaching Note 709-481, March 2009. View Details
  39. Roppongi Hills: City Within a City

    Teaching Note for [707431].

    Keywords: Competition; Performance; Brands and Branding; Buildings and Facilities; Real Estate Industry; Tokyo;

    Citation:

    Hagiu, Andrei. "Roppongi Hills: City Within a City." Harvard Business School Teaching Note 709-479, March 2009. (Revised March 2014.) View Details
  40. Microsoft Xbox: Changing the Game? (TN)

    Teaching Note for [707501].

    Keywords: Video Game Industry; Texas;

    Citation:

    Hagiu, Andrei. "Microsoft Xbox: Changing the Game? (TN)." Harvard Business School Teaching Note 709-480, February 2009. View Details
  41. Ocean Tomo: Building a Market for Intellectual Property

    Ocean Tomo's management team sought to turn the company into the leading intermediary for intellectual property. Despite its increasingly important role in the global marketplace, IP remained a notoriously illiquid asset—difficult to value, harder to trade, and often underutilized by owners. CEO Jim Malackowski and his colleagues hoped to capitalize on this inefficiency by designing and operating innovative marketplaces for intellectual property. After a successful live IP auction in the spring of 2008 (62% of 85 offered lots were sold for a total of $19.6 million), Ocean Tomo had to decide which of its five business lines to emphasize. Indeed, from its inception, Ocean Tomo had been designed as a "one-stop shop" for IP services, with five interrelated lines of business. Which of these services provided the largest market opportunity for Ocean Tomo? How should the company allocate its scarce resources (it had not sought outside funding yet) in order to get the most leverage going forward?

    Keywords: Globalized Markets and Industries; Intellectual Property; Resource Allocation; Auctions; Market Design; Service Operations;

    Citation:

    Coles, Peter A., Andrei Hagiu, and Alison Berkley Wagonfeld. "Ocean Tomo: Building a Market for Intellectual Property." Harvard Business School Case 709-404, September 2008. (Revised February 2009.) View Details
  42. How to Crack a Strategy Case

    Addresses a common concern among strategy students: "How should I tackle this case?" Describes a process for diagnosing a strategic situation, then generating, evaluating, and choosing among strategic options.

    Keywords: Decisions; Management Practices and Processes; Situation or Environment; Strategy; Valuation;

    Citation:

    Bradley, Stephen P., David J. Collis, Kevin P. Coyne, Andrei Hagiu, Mikolaj Jan Piskorski, Jan W. Rivkin, and John R. Wells. "How to Crack a Strategy Case." Harvard Business School Background Note 707-549, March 2007. (Revised February 2009.) View Details
  43. Consumer Payment Systems - United States and Japan

    Teaching Note for [909006] and [909007].

    Keywords: Cash; Cost; Motivation and Incentives; Performance Efficiency; Technology; Alliances; Governing Rules, Regulations, and Reforms; United States; Japan;

    Citation:

    Edelman, Benjamin, and Andrei Hagiu. "Consumer Payment Systems - United States and Japan." Harvard Business School Teaching Note 909-039, January 2009. View Details
  44. VMWare Inc., 2008 (TN)

    Teaching Note for [709435].

    Keywords: Competition; Software; Mergers and Acquisitions; Initial Public Offering; Management Succession; Information Technology Industry;

    Citation:

    Hagiu, Andrei. "VMWare Inc., 2008 (TN)." Harvard Business School Teaching Note 709-468, January 2009. View Details
  45. Staging Two-Sided Platforms

    Firms that aspire to develop two-sided platforms face a formidable challenge. Prospective users on each side will not invest in the platform until they are confident there will be enough users on the other side. Traditional strategies for dealing with this dilemma--subsidizing users or securing their exclusive affiliation--are costly and risky. Describes less costly staged strategies for building two-sided platforms. With the "vendor to two-sided platform" strategy, a firm starts as a vendor selling products or services to customers on just one side of a potential--but not yet existing--two-sided network. Once the first side is firmly established, it proves easier to attract users to the network's other side during stage two. With the "merchant to two-sided platform" strategy, a firm starts as a merchant buying goods from many different suppliers and reselling them, in the process absorbing all the risk of platform failure. In stage two, the firm shifts risk and control back to some or all of its suppliers, giving them more responsibility for managing inventory, pricing, and merchandising their wares. Presents examples and offers guidelines for when to use each strategy.

    Keywords: Business Model; Risk Management; Two-Sided Platforms; Supply Chain; Strategy; Retail Industry;

    Citation:

    Eisenmann, Thomas R., and Andrei Hagiu. "Staging Two-Sided Platforms." Harvard Business School Background Note 808-004, July 2007. (Revised March 2008.) View Details
  46. SAP: Industry Transformation

    SAP seeks growth in the small- and medium-sized enterprise market. To do so, it has created a platform strategy with SAP Netweaver. What are the advantages and challenges for an incumbent entering a new market? What are the benefits and challenges of implementing a platform strategy?

    Keywords: Growth and Development Strategy; Market Entry and Exit; Strategy; Technology Platform;

    Citation:

    Hagiu, Andrei, Pai-Ling Yin, Daniela Beyersdorfer, and Vincent Marie Dessain. "SAP: Industry Transformation." Harvard Business School Case 707-435, September 2006. (Revised July 2007.) View Details
  47. SAP: Industry Transformation (TN)

    Teaching note to 707435.

    Keywords: Transformation; Competitive Advantage; Problems and Challenges; Market Entry and Exit; Information Technology Industry;

    Citation:

    Hagiu, Andrei, and Pai-Ling Yin. "SAP: Industry Transformation (TN)." Harvard Business School Teaching Note 707-578, June 2007. View Details
  48. Production I.G: Challenging the Status Quo

    In July 2006, Mitsuhisa Ishikawa wondered how he could further enhance the success and visibility of his animation production company headquartered in Tokyo, Production I.G. For the year ended May 2006, Production I.G. had sales of 5,439 million yen ($47.3 million), operating profit of 404 million yen ($3.5 million), and 184 employees. Its recent film Innocence: Ghost in the Shell 2 competed at Cannes Film Festival in 2004, and the company had gone public in December 2005. These were no small accomplishments for a Japanese animation production company. Indeed, despite the global success of Japanese animation, the industry was fragmented with about 430 animation production companies and dominated by distributors--TV stations, movie distributors, DVD distributors and advertising agencies, which held the lion's share of content copyrights. Distributors controlled the funding and contracted the production out to animation production companies. As a result, most of the latter were small companies laboring in obscurity. As such, no Japanese animation production company came even close to the size of Walt Disney Co.: in 2005 Disney had revenues of $32 billion, whereas Toei Animation, the largest animation production company in Japan, had revenue of only 21 billion yen ($175 million). To Ishikawa's mind, one of the key decisions concerned the mix of the "contents garden" that his company should aspire to. Should he increase the share of animation productions based on manga (comics and print cartoons) relative to original-productions (i.e. animation stories created entirely by Production I.G.)?

    Keywords: Business Growth and Maturation; Competitive Advantage; Markets; Animation Entertainment; Going Public; Growth and Development Strategy; Motion Pictures and Video Industry; Tokyo;

    Citation:

    Hagiu, Andrei, Tarun Khanna, Felix Oberholzer-Gee, Masako Egawa, and Chisato Toyama. "Production I.G: Challenging the Status Quo." Harvard Business School Case 707-454, October 2006. (Revised March 2007.) View Details
  49. Microsoft Xbox: Changing the Game?

    In September 1999, the Microsoft Xbox team was wondering which strategic choices would give it the best chance against the upcoming Sony PlayStation 2. Initially called "Project Midway" within Microsoft, the console project was intended to counter the perceived threat to the Windows franchise posed by Sony expanding the original PlayStation into a broad entertainment platform with the PlayStation 2. Seamus Blackley--the chief instigator for the Xbox within Microsoft--and some of his colleagues were on a flight to Austin, Texas, where they had an appointment with Michael Dell, CEO of Dell Computer. The purpose of the visit was to convince Dell to manufacture Xbox videogame consoles running Microsoft software. Indeed, the team intended to produce a machine somewhere between a standalone videogame console and a PC tailored to play videogames. It remained unclear, however, where along the spectrum from dedicated console to PC Microsoft should position the Xbox. Would it be an open platform like the PC in the sense that independent developers could publish games on it with no restrictions and without having to pay royalties? Who would produce consoles and under what arrangements? What features should the console include, and how would it be priced to consumers? The home videogame industry had been born in the 1970s during the Atari "golden age", then collapsed suddenly in 1983. It was reborn at the end of the 1980s under Nintento's leadership, which was then challenged for a few years by Sega, only to be conquered by Sony's original PlayStation. And along the way, some companies such as 3DO had tried unsuccessfully to change the prevalent business models. This tumultuous 25-year history might provide Blackley and his colleagues with some useful tips on how best to enter the market.

    Keywords: Customers; Recruitment; Leadership; Management Teams; Multi-Sided Platforms; Two-Sided Platforms; Production; Strategy; Competition; Expansion; Video Game Industry; Texas;

    Citation:

    Hagiu, Andrei. "Microsoft Xbox: Changing the Game?" Harvard Business School Case 707-501, November 2006. (Revised February 2007.) View Details

Other Publications and Materials

  1. How Facebook Can Totally Undermine Apple and Google in the Platform Games

    Today, Facebook seems like the juggernaut crushing everything in its path, most recently Twitter's Vine app and Yandex's social app. And in its last quarter, Facebook's mobile usage surpassed its web usage—for the first time ever. This is important because Facebook has now begun competing not just at the social network level, but also at the operating system level. And the company turns nine today, so it will have even more mobile influence by its 10th anniversary: just look at the rapid expansion of its App Center and SDK developer tools for iOS. This means we won't just have competing platforms, but platforms built on top of other platforms. And that, as you'll see, changes the game altogether.

    Keywords: Technology Industry;

    Citation:

    Hagiu, Andrei. "How Facebook Can Totally Undermine Apple and Google in the Platform Games." Wired.com (February 4, 2013). View Details