Winning the Hardware Software Game Winning the Hardware-Software Game - 2nd Edition

Using Game Theory to Optimize the Pace of New Technology Adoption
  • How do you encourage speedier adoption of your product or service?
  • How do you increase the value your product or service creates for your customers?
  • How do you extract more of the value created by your product or service for yourself?



  • The purpose of this analysis is to better understand the dynamics of internet platforms. The analysis considers the three basic types of platforms:

    • Vendors (WalMart, Apple, Pandora, etc.)
    • Social Media (Facebook, LinkedIn, YouTube, etc.)
    • Matchmakers (eBay, Uber, etc.)

    And will seek to address such issues as

    • Who are the different players in each type of platform game? 
    • How do the players' actions combine to generate value in each type of game?
    • Who extracts what value?
    • Which types of platforms and configurations have the greatest value potential? 
  • Remember when restaurant delivery options included Domino’s, Pizza Hut, or Papa John’s? No longer! These pizza restaurants still have a majority share of the restaurant delivery market. However, GrubHub, Eat24, DoorDash, UberEats, and other restaurant delivery platforms are expanding users’ choices beyond just pizza.

    This analysis examines the Restaurant Delivery Game: Who are the Players and what are the issues?


    See Figure 1


    • Traditional (Dine-In) Restaurants
    • Takeout/Delivery Restaurants

    ♦ Takeout/Delivery Only (Virtual Restaurants)

    ♦ Dine-in or Takeout

  • The future of jobs is a serious concern.

    The most popular opinion I’ve seen is that the answer is more education. Consider, though, that we are in a period in which historically high levels of the population have some amount of postsecondary education. Yet, less than half the population (about 42%) has at least an associate’s degree, and only about a third of the population has at least a bachelor’s degree. How much higher is it realistic to think these levels can actually go? Not to mention that student debt has reached massively unsustainable levels ($1.3 trillion).

    So then what about the other half of the population?

    I recently did an analysis of changes in employment by firm size over the past few decades. My analysis showed that

    • Increasing percentages of employees have been employed in large firms, at the expense of employees in small firms.
    • New firm creation has increasingly come from openings of smaller firms, while consolidation has been rampant among the largest firms.
    • The economy has become less dynamic than it was during the 1990s, with relatively greater decreases in job activity at smaller firms.

    Taken overall, the data are consistent with economic/market conditions that

    • Are less hospitable to firms overall, and
    • Favor small firms for new innovations, but large firms for continued market success.

    Factors consistent with this environment include

    • More regulations, capture by special interests, and/or uncertainty over-all that inhibit business activity;
    • Regulations, capture by special interests,  and/or uncertainty that favor large firms over small firms (e.g., Obamacare, bank regulations that favor large and/or less risky loans over small/more risky loans, minimum wage laws, etc.);
    • Bureaucracy in larger firms that prevents new ideas from developing and/or gaining traction; and