The global digital economy market development through the prism of Porter's Five Forces model

Abstract

The rapid pace of digitalization is radically transforming the global economy, necessitating a rethinking of traditional competitive strategies. Accordingly, the purpose of this study is to advance the classical principles of Porter’s Five Forces model for assessing the competitive environment of the global digital economy. The paper proposes a refined interpretation of the competitive forces: threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat of substitutes and innovations, and the intensity of competitiveness within the global digital market. An expert-based methodology, supported by our evaluation framework, was applied to explore and characterize these competitive forces, comprising 25 indicators of competitive intensity and complemented by a comprehensive SWOT analysis. The empirical foundation for the qualitative and quantitative assessment was drawn from international rankings and indices published by leading organizations and research institutions between 2020 and 2022. The qualitative and quantitative assessment findings indicate that the global digital economy exhibits high dynamism and intense competition, and market structure transformation. The SWOT analysis underscores substantial growth potential driven by demand, scalability, and innovation, while highlighting critical challenges related to cybersecurity, regulatory gaps, market concentration, and equitable access to digital resources. Integrating the evaluation of competitive forces with SWOT insights allows for systematic identification of strategic development pathways, supporting evidence-based managerial and policy decisions at both national and international levels. The study emphasizes the need for empirical validation and further research on the evolving dynamics of competitiveness in the global digital era.