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Open AccessArticle

Valuation of Digital Platforms: Experimental Evidence for Google and Facebook

by Bodo Herzog 1,2
1
ESB Business School, Reutlingen University, Alteburgstraße 150, 72762 Reutlingen, Germany
2
Reutlingen Research Institute (RRI), Reutlingen University, Alteburgstraße 150, 72762 Reutlingen, Germany
Int. J. Financial Stud. 2018, 6(4), 87; https://doi.org/10.3390/ijfs6040087
Received: 29 August 2018 / Revised: 11 October 2018 / Accepted: 11 October 2018 / Published: 17 October 2018
(This article belongs to the Special Issue Financial Economics)
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 €. View Full-Text
Keywords: digital platform; free goods; choice experiment; two-sided markets digital platform; free goods; choice experiment; two-sided markets
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Herzog, B. Valuation of Digital Platforms: Experimental Evidence for Google and Facebook. Int. J. Financial Stud. 2018, 6, 87.

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