I’ve sat on both sides of the platform / developer dynamic: managed FB’s developer ecosystem including Zynga during our web platform days, and managed FB’s relationship with Apple/Google as the largest app developer on iOS/Android. Here’s a few things I learned:
1/ Platform management is a fascinating case study in value creation and power dynamics. Value creation: durable platforms strike a “balance of value” between platform owners, developers and end-users.
2/ Power dynamics: there’s natural tension between platform owners and developers. They share the same end-users: who owns the customer? They make each other’s products more useful: which direction does value flow? They have overlapping features: where is “the line”?
3/ The rubber often hits the road with edge cases. Platform owners move slowly and deliberately to manage precedents, knowing developers will find and exploit exceptions. Developers are running a biz: need responsive and clear communication, consistent rules, room for innovation.
4/ Platform owners think in terms of threading needles. They want to accommodate edge cases without creating slippery slopes. They want developer love while extracting appropriate value exchange. They want to make room for innovation while protecting against abuse.
5/ Developers think in terms of autonomy & boundaries. They want distribution but fear disintermediation. They want to innovate w/out interference. They don’t mind rules but detest capriciousness. They are willing to share upside as long as it’s proportional. Level playing field.
6/ Most tech companies aspire to have their own platform, not just be a developer on other people’s platforms. Developer ecosystems are a deep moat, platform companies control their own destiny, and platform businesses are extremely valuable.
7/ But building an indispensable app is obviously also very valuable. Facebook and Amazon have built huge businesses without controling the platform. Here’s a test: would end-users switch platforms if your app wasn’t available? Think of WeChat in China.
8/ Managing these dynamics - on both sides - was the most interesting and challenging part of my job over 13 years running Partnerships at Facebook.
