The Internationalization of Digital Platform-based Firms
Digital platform-based firms (DPBFs) are affecting our personal lives to a great extent and they are influencing the global economy dramatically. DPBFs (e.g., Facebook, Amazon, Uber) are defined as firms providing an internet-based platform where multiple types of users interact with each other and exchange products, services, and information, which generates value for the firm. The dominance of these firms in the global economy is evident in the fact that, through global market capitalization, DPBFs have risen from not featuring in the top ten in 2007 to ranking seven out of top ten firms in 2019. This staggering rise is due to their unique business model and their ability to internationalize quickly across the world. Yet, there is little research on the internationalization process of DPBFs. In particular, how do these firms internationalize and how well do extant international business (IB) theories explain the phenomenonal rise of these novel firms? This research aims to fill this gap through the following three studies.
The first study focuses on consolidating the existing literature on the DPBFs’ internationalization phenomenon through a systematic literature review. One hundred and twenty-three articles from 2000 to 2024 are investigated to analyze the contradictions in the existing scholarship across the seven IB themes of scale, scope, performance, location choice, entry mode, process, and speed. Among others, homogenous consideration of DPBFs and inappropriate contextualization of constructs emerge as factors accountable for the inconsistent findings in the review. We provide a novel classification of DPBFs and a detailed future research direction to settle this debate. The second study is a qualitative multiple case-based study which aims to understand how emerging market DPBFs succeed in the foreign market despite being resource deficient and late comers. Mathew’s linkage, leverage, and learning (LLL) framework is applied to explain the internationalization of emerging market firms. The study also draws on insights from interviews with senior Indian DPBF leaders; a novel approach to DPBFs is developed to explain their internationalization phenomenon. The final study is again based on the qualitative interviews with the senior leaders of Indian DPBFs to identify various types of advantages DPBFs gain while internationalizing. Drawing on Luo’s framework of new OLI advantages of open resource, linkage, and integration, a new P-OLI (platform open resource, linkage, and information and knowledge) advantages framework for DPBFs is presented in this research.
This thesis contributes to the scholarship in this field in multiple ways. First, we contribute to the IB literature and in particular, DPBFs’ internationalization literature by providing multiple future research directions. Second, we develop a novel internationalization process framework for emerging market DPBFs, thereby contributing to the literature on emerging markets and IB. Finally, we present P-OLI advantages which assist DPBFs to overcome the liability of foreignness while internationalizing, and thus contribute to the DPBF and IB literature. For practitioners, this research provides a blueprint to the internationalization process of Indian DPBFs.