Human Value as the North Star: Regulating pervasive platforms — with Marshall Van Alstyne and Geoffrey Parker

Podcast Notes

In this episode we have two leading platform thinkers on the show: professors Marshall Van Alstyne and Geoffrey Parker.

Marshall Van Alstyne is Questrom Chair Professor at Boston University and his work has been honoured with numerous best paper awards, National Science Foundation grants and been featured in Science, Nature, Wired, the New York Times, the Wall Street Journal and on NPR.

Geoffrey Parker is professor of engineering at the Thayer School of Dartmouth College, where he also serves as director of the Master of Engineering Management Program.

Together with Sangeet Choudary, they are the authors of Platform Revolution: How Networked Markets Are Transforming the Economy — and How to Make Them Work for You, from 2016. As originators of the concept of the inverted firm, they were further joint winners of the Thinkers50 2019 Digital Thinking Award, and are both visiting scholars at the MIT Initiative for the Digital Economy and co-chair the annual MIT Platform Summit (see references below).

In this conversation, we talk about what democratising access to data means for the ability of players in a platform-ecosystem context to innovate and how regulation should be conceived participatory and ex ante and that useful intervention should be designed to minimise potential harmful externalities that take place outside of otherwise internally self-regulated platforms. With creating human value as the North star, Marshall and Geoffrey ponder that we might want to see the creation of a Magna carta of citizens rights for how we should be able to operate and influence on powerful platforms.

Here are some important links from the conversation.

Find out more about Marshall and Geoffrey’s work:

• Geoffrey G. Parker, Marshall W. Van Alstyne & Sangeet Paul Choudary, Platform Revolution: How Networked Markets Are Transforming the Economy and How to Make Them Work for You, 2016. https://www.amazon.com/Platform-Revolution-Networked-Markets-Transforming/dp/0393249131
• MIT Platform Strategy Summit 2020 edition taking place virtually on 8 July: http://ide.mit.edu/events/2020-mit-platform-strategy-summit
• Google Scholar profiles.

– Marshall Van Alstyne: https://scholar.google.com/citations?user=zMqwIkIAAAAJ&hl=en&oi=ao

– Geoffrey Parker: https://scholar.google.com/citations?hl=en&user=He__Th0AAAAJ

Further reads sent over by Marshall and Geoffrey:

• Platform Revolution — Offers an operator’s manual for building platforms (easy read) https://www.amazon.com/Platform-Revolution-Networked-Markets-Transforming/dp/0393354350/ref=tmm_pap_swatch_0?_encoding=UTF8&qid=1591806248&sr=1-1
• Digital Platforms & Antitrust — Categorizes the harms from platforms, critiques existing solutions, and offers one path forward (easy read). https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3608397
• Pipelines, Platforms & New The Rules of Strategy — Tells how strategy differs from products to platforms (Harvard Business Review “Must Read” — easy read). https://hbr.org/2016/04/pipelines-platforms-and-the-new-rules-of-strategy
• Platform Ecosystems: How Developers Invert the Firm — Provides a proof that platforms become “inverted firms,” moving production from inside to outside, once network effects become large enough (MISQ Best Paper — hard read). https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2861574
• The Social Efficiency of Fairness — Provides proof that treating people fairly increases rates of innovation (mimeo — hard read) https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1514137

Other mentions and references:

• Simon Wardley on the Innovate-Leverage-Componentize (ILC) cycle.

Part I: https://blog.gardeviance.org/2014/03/understanding-ecosystems-part-i-of-ii.html;

Part II: https://blog.gardeviance.org/2015/08/on-platforms-and-ecosystems.html

• Long Tails, Aggregators & Infrastructures, Simone Cicero: https://stories.platformdesigntoolkit.com/long-tails-aggregators-infrastructures-bdf84e32531d
• Avivah Wittenberg-Cox, “5 Economists Redefining… Everything. Oh Yes, And They’re Women” — Mariana Mazzucato on the role of government investment in early innovations: https://www-forbes-com.cdn.ampproject.org/c/s/www.forbes.com/sites/avivahwittenbergcox/2020/05/31/5-economists-redefining-everything–oh-yes-and-theyre-women/amp/

Find out more about the show and the research at Boundaryless at https://boundaryless.io/resources/podcast/

Thanks for the ad-hoc music to Liosound / Walter Mobilio. Find his portfolio here: www.platformdesigntoolkit.com/music

Recorded on June 10th 2020

Key Insights

1. Democratised access to data is a key driver of innovation that create interesting and hard questions for regulators and scholars to solve, including on whether access to data is being used to prevent competition, and how it can be used to promote competition and innovation, and how to maximise consumer welfare. The focus on data ownership may also leave space to a new focus on extracting meaning from data (datapoiesis).

2. Forces of fragmentation and aggregation are providing interesting balancing properties across forms of organisation. On the one hand, you get benefits of specialisation, so the first force fragments the market. The second force integrates the market as you go from one process to another, integrating the learnings from interactions in the ecosystem.

3. When platforms are causing damaging spillovers and harmful externalities off the otherwise self-regulated platform environment, we need to start looking at ways to correct the behaviour as a platform. We need new regulations able to: i. restore some of the bargaining power of collectives; ii. introduce fairness in the distribution of value; iii. get platforms to internalise the negative externalities, like the fake news, that is occurring off platforms.

? Boundaryless Conversations Podcast is about exploring the future of large scale organising by leveraging on technology, network effects and shaping narratives. We explore how platforms can help us play with a world in turmoil, change, and transformation: a world that is at the same time more interconnected and interdependent than ever but also more conflictual and rivalrous.