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Valuation of Digital Platforms: Experimental Evidence for Google and Facebook

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  • Bodo Herzog

    (ESB Business School, Reutlingen University, Alteburgstraße 150, 72762 Reutlingen, Germany
    Reutlingen Research Institute (RRI), Reutlingen University, Alteburgstraße 150, 72762 Reutlingen, Germany)

Abstract

This article investigates the fundamental value of digital platforms, such as Facebook and Google. Despite the transformative nature of digital technologies, it is challenging to value digital services, given that the usage is free of charge. Applying the methodology of discrete choice experiments, we estimated the value of digital free goods. For the first time in the literature, we obtained data for the willingness-to-pay and willingness-to-accept, together with socio-economic variables. The customer’s valuation of free digital services is on average, for Google, 121 € per week and Facebook, 28 €.

Suggested Citation

  • Bodo Herzog, 2018. "Valuation of Digital Platforms: Experimental Evidence for Google and Facebook," IJFS, MDPI, vol. 6(4), pages 1-13, October.
    • Handle: RePEc:gam:jijfss:v:6:y:2018:i:4:p:87-:d:176180
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    References listed on IDEAS

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