Transitioning the company from product to platform ecosystem ..

Nathan Furr in the April '16 HBR article (click here) talks of how to move from a product based company to a platform company and the related steps, relevant issues and challenges.

Maintaining a product based company or moving to a platform, which is better ? Moving to a platform would naturally invite many external players and in turn increase the revenue streams for the company from the many different products that run on the platform. 

Generally tranisition from product company to a platform based company would involve three stages. 

1. internal product R&D and external complementors
   
2. internal product R & D and blended complementors and community management
3. hybrid business model management

We can take the example of Google Youtube for illustration purpose.  

Initially in the first stage, Google saw to it that the internal R&D developed the system well enough to mke it robust anbd agile to accept different formats of video  and resolutions. During this stage they also helped introduce other complementors who brought in viewership to the Youtube video hosting platform

The second stage involved Google subjecting Youtube to more R&D improving the resolution and compression technology of the videos to save on valuable bandwidth during playback. The collaborators in compression technology now become internal to the company with the free platform being opened to organisations and religious institutions to beam, their live events, making it  a community wise much accepted medium of communication.

All this while Youtube developed the revenue streams by offering ads at the beginning and between the videos at fixed time intervals. 

The third stage involved how Youtube started offering Youtube Premium that generated revenue streams for the company by charging Youtube customers and Google Home customers, for a small monthly fee, ad free viewing.

Youtube Premium like Amazon Prime generates committed customers who would not migrate to other video streaming business models. It also helped Youtube create massive first mover advantage and an unassailable lead over competitors in the video streaming ecosystem.

George..