Beyond digital platforms: Exploring the design and competitive dynamics of cyber-physical platforms

Abstract

Interest in platforms has rapidly proliferated during the last decade. Yet, research has thus far exclusively focused on purely digital platforms and has failed to offer insights into so-called cyber-physical platform that integrate the digital space with the physical world. In this paper, we introduce the notion of cyber-physical platforms and contribute to research on platforms by asking what cyber-physical platforms are. Additionally, through an in-depth case study of Yourban, the Enel X cyber-physical platform for municipalities and public administrations to integrate and manage smart city services, we explore how their essential features influence the technological architecture, competitive dynamics and ecosystem management of cyber-physical platforms. Our findings show how the physical components pose a significant entry barrier, protecting incumbents while limiting the growth potential of cyber-physical platforms. We also explain why density rather than network effects appear to be more important for cyber-physical platforms than for digital platforms and why platform openness is a necessity rather than a choice for platform providers. Together, our article provides contributions to research on platforms and outlines possible directions for future research.