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M&A as capability building : patent evidence from Big Tech
Journal article   Open access   Peer reviewed

M&A as capability building : patent evidence from Big Tech

Ilan Strauss and Jangho Yang
Applied economics letters, pp.1-5
15/04/2026
Handle:
https://hdl.handle.net/10210/520861

Abstract

Business & Economics Economics Social Sciences
Traditional antitrust focuses on market shares, but many Big Tech acquisitions have technological motivations that cut across distinct product markets. We advance a patent-based framework whereby Big Tech's acquisitions aim to consolidate horizontally or diversify vertically technological capabilities through buying proven or nascent technologies - proxied by predicted patent citation potential. Linking 995 Big Tech M&A transactions (2000-2022), of which 223 yielded patents, to 114,004 patent families, we find that diversification dominates: four of five Big Tech firms acquire predominantly outside their core technology areas, consistent with ecosystem expansion. Firms vary in favouring proven vs. nascent technologies.
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Open Access CC BY V4.0
url
https://doi.org/10.1080/13504851.2026.2651435View
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