Leadership and Competitive Strategy in Platform Indus-tries

Firms choose competitive strategies to achieve higher profitability and ultimately market leader-ship. In platform industries, aside fromin addition to market leadership, platform leadership and firm leadership within a platform emerge. We use a dynamic model to characterize those three types of leadership in platform industries. We show how these types of leadership shape market structures and determine competitive strategy. We simulate the model to find the optimal com-petitive strategy conditional on each market structure and thus firms? leadership. We show that optimal competitive strategies fall into four categories, and the types of leadership, not leadership alone, determine a firm?s optimal type of competitive strategy.