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Big Tech Acquisitions and Product Discontinuation

Author

Listed:
  • Axel Gautier
  • Robert Maitry

Abstract

The five largest firms by market capitalization, Alphabet, Amazon, Apple, Meta, and Microsoft have massively acquired companies during the last decades, mainly but not exclusively young tech startups. Interestingly, most of the acquired products are discontinued post-acquisition. In this paper, we have collected data on the acquisitions of the big techs for a period of 7 years spanning from 2015 to 2021 and we analyze the evolution of the acquired firms’ products post-acquisition. To analyze the decision to continue or not a product post-acquisition, we classify acquisition in four categories: products that are still offered under their initial brand name, products integrated in the acquirer’s ecosystem, products that are no longer available and products that are killed by the acquirer. We use these classifications to provide detailed information and statistics on the discontinuation decision of the acquiring firm and we run Probit estimation to explain their determinants.

Suggested Citation

  • Axel Gautier & Robert Maitry, 2024. "Big Tech Acquisitions and Product Discontinuation," Journal of Competition Law and Economics, Oxford University Press, vol. 20(3), pages 246-263.
    • Handle: RePEc:oup:jcomle:v:20:y:2024:i:3:p:246-263.
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    File URL: http://hdl.handle.net/10.1093/joclec/nhae010
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    Cited by:

    1. Marc Bourreau & Axel Gautier, 2024. "Innovation and Startup Acquisition," CESifo Working Paper Series 11569, CESifo.

    More about this item

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

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