The incorporation of digital technologies into the products of diverse industries, accompaniedby a shift to von-Neumann-like platform architectures, while resulting in substantially more valuableand flexible products, also leads to increased substitutability across previously distinct markets....

We model an oligopolistic technology market in which firms endogenously choose product scope,fixed costs are affected by exogenous technological progress, and there may be threat of entry. Ouranalysis shows that equilibrium outcomes involve substantial overinvestment in product scope,which...