Platform Economy
The platform economy is driven by digital platforms facilitating interactions between producers and consumers.
Platform Types
Transaction platforms (marketplaces: Amazon, Airbnb), innovation platforms (iOS App Store, Android), integrated platforms (Apple, Google), social platforms (Facebook, TikTok, LinkedIn).
Network Effects
Direct (same-side users: social media), indirect/cross-side (users attract producers and vice versa: app store). Negative effects possible (congestion, spam). Key to platform strategy.
Platform Strategy
Subsidise one side, solve chicken-and-egg problem, build trust (ratings, reviews), governance (rules, quality), data leverage (personalisation, matching).
Competition
Multi-homing costs, differentiation, trust/safety, ecosystem richness. Winner-take-most common. Regulation addresses monopoly power.
Gig Economy
Platforms connect freelancers with work: ride-hailing (Uber, Pathao), delivery, freelancing (Upwork, Fiverr). Issues: worker classification, benefits, income stability.
Regulation
Antitrust, content moderation, data protection, worker rights, digital services taxes. Varies significantly by country.
Summary
Platform economy reshapes business through network effects, multi-sided markets, and data-driven matching.