The Competitive Dynamics Of Web Sites
The phenomenon of electronic commerce has led to a proliferation of web sites competing for the attention and resources of millions of consumers. As has been recently shown, the resulting dynamics is such that a few sites command most of the traffic in the web, a signature of a winner-take-all market.In order to explore the effects of competition among web sites and to determine how they affect the nature of markets, we present a dynamical model of web site growth and competition, which takes into account both the evolution of the probabilities that a person visits sites as well as the existence of links between sites.We show that under general conditions, as the competition between sites increases, the model exhibits a sudden transition from a regime in which many sites thrive simultaneously, to a "winner take all market" in which a few sites grab almost all the users, while most other sites go nearly extinct. This transition is similar to what in ecology is called the Principle of Competitive Exclusion.Furthermore, we study the effect of site linkage on the number of visitors to both competitive and cooperative sites, as well as the implications of our results for linking strategies as practiced on the web. Common link structures found on the web, such as web rings, are also analyzed.Finally, we show web usage data that motivates our work and places the different behaviors in context.
|Date of creation:||05 Jul 2000|
|Contact details of provider:|| Postal: CEF 2000, Departament d'Economia i Empresa, Universitat Pompeu Fabra, Ramon Trias Fargas, 25,27, 08005, Barcelona, Spain|
Fax: +34 93 542 17 46
Web page: http://enginy.upf.es/SCE/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Erik Brynjolfsson & Michael D. Smith, 2000.
"Frictionless Commerce? A Comparison of Internet and Conventional Retailers,"
INFORMS, vol. 46(4), pages 563-585, April.
- Michael Smith & Erik Brynjolfsson, 1999. "Frictionless Commerce? A Comparison of Internet and Conventional Retailers," Computing in Economics and Finance 1999 1022, Society for Computational Economics.
When requesting a correction, please mention this item's handle: RePEc:sce:scecf0:357. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christopher F. Baum)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.