China’s Mobile Payments in Complementary Multiplatform Ecosystems

Abstract

Using a longitudinal case study this paper aims to demystify how China developed the world’s largest mobile payment market based on a backward technology and in a rigid institutional environment. We find that, different from multi-sided platform ecosystems, complementary multi-platform ecosystems are critical in the success of China’s mobile payments. In such ecosystems, mobile payment platforms – a nascent filed at the convergence of mobile communications and payment industries – are a type of ‘platform of platforms’ intermediating multilateral interactions across multiplatforms. We expanded the scope of complementarity in ecosystems from multi-sided platform ecosystems to multi-platform ecosystems. The findings enrich our theoretical understanding of the effects of multi-platform ecosystems on individual platforms, not only on nurturing a nascent field (i.e., mobile payments) by enacting a value co-creation and co-capture environment for sharing, but also on signalling their legitimacy in a country where institutional settings are generally rigid. The lessons also carry practical and policy implications.