<p>Digital platforms invest in generative AI (GenAI) for users’ value creation. This study distinguishes value co-creation (VCC) and independent value creation (IVC) models, focusing on IVC platform strategies. It innovatively incorporates GenAI’s unique features, human-AI interaction quality (HIQ) and post-training based on human feedback (PTHF), into a two-period analytical model in a two-sided market. Employing factors in the AI Device Use Acceptance (AIDUA) model to measure user utility from HIQ and incorporating the effects of PTHF, we consider cross-side network externality and users’ participation and analyze the competition between two IVC platforms (the incumbent and the entrant). Findings show the incumbent’s GenAI investment is influenced by user expectancies and hedonic motivation; switching costs, PTHF, and the incumbent’s investment benefit it but harm the entrant; higher HIQ in GenAI gives the platform an edge in entry accommodation. Our findings enhance understanding of GenAI-enabled IVC platforms.</p>

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How does generative AI impact the platforms’ competition strategies? The effects of human-AI interaction and human feedback

  • Yudi Chen,
  • Jing Wu

摘要

Digital platforms invest in generative AI (GenAI) for users’ value creation. This study distinguishes value co-creation (VCC) and independent value creation (IVC) models, focusing on IVC platform strategies. It innovatively incorporates GenAI’s unique features, human-AI interaction quality (HIQ) and post-training based on human feedback (PTHF), into a two-period analytical model in a two-sided market. Employing factors in the AI Device Use Acceptance (AIDUA) model to measure user utility from HIQ and incorporating the effects of PTHF, we consider cross-side network externality and users’ participation and analyze the competition between two IVC platforms (the incumbent and the entrant). Findings show the incumbent’s GenAI investment is influenced by user expectancies and hedonic motivation; switching costs, PTHF, and the incumbent’s investment benefit it but harm the entrant; higher HIQ in GenAI gives the platform an edge in entry accommodation. Our findings enhance understanding of GenAI-enabled IVC platforms.