Conceptualizing IIoT Platform Ecosystem Verticalization

Abstract

In this paper, a research gap at the interface of ecosystem theory, platforms and market segmentation strategies is addressed by conceptualizing the verticalization of Industrial Internet of Things (IIoT) platforms and their surrounding ecosystems. After an introduction to business-to-business (B2B) platform ecosystems and IIoT platforms as manifestation of B2B platforms, the concept of verticalization as an example for a market segmentation strategy in the digital domain is discussed. Based on an existing generic verticalization framework, the concept will be transferred from its original application in enterprise software systems to the IIoT. A hypothesis is derived that postulates a causal relationship between IIoT platform ecosystem verticalization and the platform owner's competitive advantage for commercializing an IIoT platform in the market. The research contributes to literature on platforms in information systems and strategic management research by proposing platform ecosystem verticalization as a novel verticalization property. Applied as business strategy, this might enable a commercially successful implementation of IIoT platforms.