Multi-sided Platforms Research Articles

The Platform Canvas—Conceptualization of a Design Framework for Multi-Sided Platform Businesses

Digital multi-sided platforms reshape today’s economy by reducing coordination costs among participants in a market. The platform’s business model creates and captures value differently than a traditional linear business model. Just as the Business Model Canvas helps entrepreneurs and professionals visualize the essential elements and mechanisms of a linear business model, this paper proposes a Platform Canvas to diagram the essential elements of a multi-sided platform business, including the architectural relations of these elements and the dynamics of the network effect. We then describe how the Platform Canvas can be useful to entrepreneurs, educators and scholars.

Understanding Multisided Platforms, Circular Economy and Tourism

A multisided platform is a model that creates value by facilitating exchanges between two transaction partners which means the platform plays an intermediary role between the two groups. This is also called “knowledge economy “or “third globalization” which has been brought into one platform through technology and information. In business, the platform is recognized as a marketing terminology. Comparatively the state, government, and civil society are influenced by various technologies in several fields of human activities and provide beneficiaries to human beings. This study aims to introduce the multisided platforms and their respective fields in businesses on one side and the other side, it shows the link between tourism and circular economy and explains why is circular economy becoming a key factor for contributing to keeping the balanced environment in highly industrialized, urbanized, overpopulation including over tourism. These days the circular economy has become closely associated with sustainability and sustainable tourism and development.

Editorial – Tourism Trends – Part 1

(2020) make a number of observations about enhancing an understanding of the evolution of actor networks for destination development to build a resilient network. The tourism industries response to climate change has being sustainable tourism. Another technology paper by Aamir and Atsan (2020) addresses remarkable trend of multisided platforms in the travel industry with the help of which travel agencies and global distribution systems can reinforce their intermediary role.

The Dynamics of Single- and Multi-Sided Platform Monopolies

In this paper we develop a general model of one-sided and two-sided platform businesses and apply it to a monopolist framework. We have a particular interest in how the social loss and other metrics depend on the strength of the network (direct or indirect) effect. We study how network effects impact monopoly power, how the deadweight loss decomposes between market power and the unpriced network externality, and how cross-subsidies relate to the strength of the network effects. We find that the stronger the network effect, the larger the optimal size of the platform and the greater the deadweight loss, while the smaller is the monopolist’s profit margin. In the two-sided setting, we explore the social benefits of allowing positive profit on one side to subsidize price on the other side below cost. We find that under some of the more extreme parameterizations we consider, a regulated platform required to break-even on both sides of the platform (rather than just in total) could be socially less desirable than the unregulated monopolist. This result obtains infrequently across the parameterizations we study, but it is a possibility.

The Role of Analytics in Data-Driven Business Models of Multi-Sided Platforms: An exploration in the food industry

IntroductionData-driven business models (DDBMs) are either emergent or new multi-layered, multi-dimensional business models enabled by big data (Hartmann et al., 2016). Several highly diverse industries are moving towards DDBM to survive and compete. Such industries include especially those in which understanding user-buying patterns in an in-depth manner is becoming

Assessing abuse of dominance in the platform economy: a case study of app stores

ABSTRACT App stores constitute a quintessential multisided platform market, where a few players (Apple and Google) facilitate transactions between third-party suppliers (app developers) and consumers in exchange for a commission fee. Complicating matters, these app stores are embedded in intricate mobile ecosystems with varying degrees of “openness” to third parties. Increasingly, these third parties are complaining about allegedly anticompetitive practices. In particular, the operators of app stores are said to preference the distribution of their own apps over those of competitors, levy excessive commission fees, and operate in a non-transparent manner. We offer a comprehensive assessment under Article 102 TFEU, examining market definition and market power of app stores, the application of various theories of harm (and corresponding legal tests) to their allegedly anticompetitive behaviour, potential justifications for said behaviour, as well as the impact of the new P2B Regulation and on-going regulatory initiatives.

Socialising the decision-making process: transaction provenance decision support

ABSTRACT This paper extends some current decision-Making and DSS perspectives that were originally identified in Herbert Simon’s decision-making and action process model, socialising them in theory and practice to account for the effective development of decision support systems that can profitably be incorporated in the context of multisided platform- powered eco-systems. It shows how adopting these extended perspectives enhances the opportunities for supporting socialised (rather than individualised) action and development through ‘Transaction Provenance Decision Support’ (TPDS). It takes as its example SMART.T, a TPDS powered by two multisided platforms enabling trading, provenance-building and socio-economic development. These are (i) a provenance authentication platform, and (ii) a transaction management platform. Together, these platforms offer the core functions needed for a comprehensive TPDS. As discussed in this paper, these functions are: integration of transactions involving private and public goods in TPDS; exploring, and establishing provenance; structuring provenance within the World Wide Web Consortium’s Provenance Ontology; authenticating provenance; socialising decision enactment; anticipating good provenance within a transaction network. It establishes the importance of provenance in providing socialised, end-to-end, multisided decision support within the TPDS platform-powered eco-systems that will drive the rapidly expanding platform business sector in the future.

Hacking the SEAMs: Elevating Digital Autonomy and Agency for Humans

The time has come to challenge the predominant controlling paradigm of the World Wide Web. We need to replace controlling “SEAMs” with empowering “HAACS.” Over the past two decades, Web platform ecosystems have been employing the SEAMs paradigm – Surveil users, Extract data, Analyze for insights, and Manipulate for impact. The SEAMs paradigm is embedded as reinforcing feedback cycles in computational systems that mediate, and seek to control, aspects of human experience. Fronting that SEAMs paradigm are unbalanced multisided platforms (treating patrons as mere users), Institutional AIs (consequential and inscrutable decision engines), and asymmetrical interfaces (one-way device “screens,” environmental “scenes,” and bureaucratic “unseens”). Behind all this tech, SEAMs-based feedback cycles continually import reams of personal data, and export concerted attempts to influence users. While holding accountable these Web platform ecosystems is absolutely necessary work, by itself it does not engender true systems change. The approach suggested here is to challenge, and eventually replace, the underlying SEAMs paradigm itself with a far more human-centric one. The proposed HAACS paradigm is premised on a different approach – human autonomy and agency, via computational systems. Rather than feed controlling tech systems, the HAACS paradigm supports new ecosystems that empower ordinary human beings. This means building institutions, governance frameworks, and technologies that: • Enhance and promote human autonomy (thought) and agency (action); • Conceptualize personal data as flows of digital lifestreams, managed by individuals and communities as stewards under commons and fiduciary law- based governance; • Introduce trustworthy entities, such as digital fiduciaries, to help manage individual and collective digital interactions; • Create Personal AIs, digital agents that represent the human being vis-a-vis Institutional AIs operated by corporate and governmental interests; and • Craft symmetrical interfaces that allow humans to directly engage with, and challenge, controlling computational systems. Put more simply, these proposals translate into two compact terms: the human governance formula of D>=A (our digital rights should equal, if not exceed, our analog rights), and the technology design principle of e2a (edge-to-all). While the Age of Data remains in its infancy, time is growing short to challenge its many underlying assumptions. The proposed new HAACS paradigm represents one such opportunity. HAACS relies on design thinking precepts, and embraces a holistic, collaborative, systems-informed approach. Some real-world proposals in Appendix A leverage multiple ecosystem-building opportunities simultaneously across technology, market, policy, and social environments.

A pro-Africa approach to multi-sided music platforms

Being present on multi-sided music platforms such as YouTube, Facebook and SoundCloud is nowadays often seen as a necessity for any artist: there is currently no better way to connect with a prospective audience. As a result, multi-sided music platforms are extremely popular. However, the way they use copyright-protected content in digital advertising raises numerous questions with regard to copyright protection, competition and privacy alike. Chijioke Ifeoma Okorie’s book expertly guides the reader in a thorough exploration of the application of copyright law, privacy law and competition law in regulating multi-sided music platforms, using Nigeria and South Africa as the two focus countries. Structured into seven chapters, the book begins with an introduction as to the workings of multi-sided music platforms. Multi-sided platforms are ‘[an] avenue or means for several market participants to interact with themselves’. A multi-sided music platform is one which uses music as a free product to...

Nonprofit Organizations as Multi-Sided Platforms

The theory of multi-sided platforms (MSPs), originally known as two-sided markets, has been influential in helping digital platforms like Google and Facebook monetize their popular free services. However, this theory can apply to any firm that serves multiple sets of customers who are inter-related in a particular way, namely at least one type of customer prefers that there be greater numbers of the other type. Thus, in its most abstract form, MSP theory can be applied to nonprofit organizations, a setting of growing interest among management scholars. Moreover, this theory can offer nonprofit managers guidance on certain questions that for-profit managers typically do not face, such as whether to charge money for nonprofit services. We therefore focus on how MSP theory can provide practical guidance on nonprofit pricing, highlighting three findings. First, donors and recipients of nonprofit services can be regarded as two sides of an MSP. Second, the price of the nonprofit’s services will be discounted because of donor-side demand. Third, nonprofit services might be discounted to zero, resulting in free services. This paper thus extends the domain of MSPs by applying it to nonprofits, and also contributes to the growing literature on nonprofit management and strategy.

Can Business Model Success be Evaluated? A Mixed Method Approach with Digital Marketplaces

In this paper, we identify possible success factors of multi-sided platforms. To this end, we conducted an explorative quantitative study. Based on the literature on network effects, platforms, and business models, we develop a codebook that supports quantitative document analysis. We study the data collected using multiple linear regression in order to determine their influence on the success of the platforms, which we define as received funding and turnover. The focus on digital marketplaces, a type of multi-sided platforms, is necessary to achieve robust results and to reveal significant effects. Our analysis shows that several value propositions, central members or key partners, and the addressing of B2C and B2B customers can have a positive effect on success. The results demonstrate a positive effect if users can take on several platform roles, if several revenue sources exist, and if platforms offer their value proposition via website as well as mobile application. Contrary to expectations, several key revenue streams have a negative impact on the company's success. We observed negative influence on success in the absence of certification of the providers on the platform. It is therefore likely to be a hygiene factor and not a success factor. With our research results, we contribute to the evaluation and comparison of digital marketplaces and their underlying drivers using a mixed-method approach.

Managing the Identity-Size Paradox in Platforms: The Case of Platform Cooperatives

Platform organizations operate between two different competition logics: winner-takes-all, which prioritizes platform size, and distinctiveness logic, which prioritizes platform identity as a strategic dimension. While the platform strategy literature has primarily focused on the former, outlining ways to quickly grow the network of users and complementors, it has largely ignored platform identity. A key challenge for platforms is, however, to manage tensions that arise when both size and identity constraints are present. To explore how strategic tensions between platform size and platform identity are manifested and what platforms do to address them, we employ a multi-case study of platform cooperatives – an organizational form that commences from a distinctiveness logic. We find that platform cooperatives deal with several size-identity tensions as they go through three core phases: (1) enacting identity as a vehicle for growth; (2) diluting identity to enable growth; (3) growth-enabled identity redefinition. Moving across these phases, we identify the underlying strategic activities that platforms use to navigate what we termed as the ‘identity-size paradox’. Overall, we contribute to the literature on multi-sided platforms, and particularly in regards to platform strategy, as well as to the broader platform economy literature. Keywords: platform strategy, new organizational forms, platform cooperatives, platform identity

Competitive (dis)Advantage from Learning in Multisided Platforms: Opening Different Platform Side

The strength of network effects is critical for the performance of multisided platforms. Platform operators invite different sides (e.g., application developers in smartphones) for their contributions to value creation. Even though platform operators impose limitations and control on who gets to participate on each side of the market, the constant pursuit of growth due to competitive pressures usually leads to policies that encourage open participation. An interesting, and sometimes unintended consequence of opening a platform is that rival platform operators can also participate as sides, or complementors. Acting as a complementor, rival platform operators can learn beyond what they could learn as outsiders, and use this learning to gain competitive edge over the platforms in which they participate as complementors. We examine the effects of this learning as a source of competitive advantage for a platform operator that is participating in a rival (host) platform as a complementor. Using an agent-based simulation model, we develop insights including one on the moderation effect of market dynamism. We find that learning leads to competitive edge in markets with low to moderate levels of dynamism (as measured by the rate and magnitude of change), but not in those with high levels of dynamism, with an exception in markets with both high dynamism and switching costs. This is true even if competitive advantage from learning diminishes as switching and learning costs increase.

The Effect of Micro Entrants on Generalists' Performance

Resource partitioning theory and market entry research provide tremendous clarity on specialists, generalists and entrant-incumbent dynamics, but such scholarship overlooks micro enterprises—a distinct strategic group of firms who are very small in terms of scale, scope, and/or capability yet they are often seen as specialists. This is a serious oversight because unlike specialists who erode incumbent positions one at a time, micro entrants not only act differently, they often ride on top of multisided platforms (e.g., Airbnb, Uber, Etsy, Facebook, etc.) and gain market access almost overnight. In addition, while extant research focuses on adversarial entrant- incumbent relations, our study redirects attention to why and how the entry of micro enterprises augment the performance of generalists. Using panel data on entrants who provide dwelling capacity via the Airbnb platform from 2010 to 2015, we show that micro entrants enhance the performance of large incumbents (i.e., four-star hotels). We also find that an influx of micro entrants has even a stronger positive effect on generalists’ performance when the generalists’ market is more concentrated, and the activity of the multisided platforms is regulated. All in all, we show that when resource partitioning theory recognizes micro enterprises it provides new and greater clarity on entrant-incumbent relations.

Creative vs. Pragmatic Variety: On the Tradeoff between Professional and Market Logics in Platforms

Digital multisided platforms and peer-to-peer marketplaces are increasingly attracting attention from scholars, with a significant amount of work examining the role of complementors. Yet, despite such focus, limited work has investigated the implications of complementor choices about what products to offer, particularly in platforms for creative products. In this study, we investigate the role of the tradeoff between the professional and market logics in performance, as reflected by the product offerings of designers in a platform for creative products. Leveraging a rich panel data set from a platform for creative products, Ravelry, we find that designers achieve superior performance by following the logic of the market and responding to existing consumer demand (pragmatic variety). However, by following the logic of the market, designers are more prone to diminishing returns to their product offerings as the platform grows and other designers join, compared to those who follow the logic of the profession (creative variety). That is, the logic of the profession shields designers from negative effects of crowding. Further, results indicate that the logic of the profession and that of the market conflict with each other.

Noisebnb: An Empirical Analysis of Home Sharing Platforms and Noise Complaints

Digital multisided platforms and their societal implications are increasingly attracting attention from scholars. In this prior work, the predominant focus has been on platform participants, with little consideration given other market actors who coexist with the platform, but do not participate in it directly. In this study, we investigate one aspect of the changing economy subject to considerable theoretical ambiguity: the effects of peer-to-peer home sharing on noise complaints, a growing problem associated with urban living. Leveraging the phased expansion of home sharing platform Airbnb into different locations at different times, and a differences-in-differences approach, we find that the entry of Airbnb is associated with a significant decrease in the rate at which city residents file residential noise complaints. This is striking, given the assumption made by academic literature, industry and government reports, and the popular press that externalities will be negative. This significant decrease is intensified further in locations where a material number of tourist attractions exists, suggesting the effect is driven by limited physical occupancy of residential housing. Corroborating this finding, we observe a significant increase in street noise following the entry of Airbnb, indicating that noise moves out of residential space and into streets where tourist attractions mostly take place.

Uber Sub-Saharan Africa: contextual leadership for sustainable business model innovation during COVID-19

Learning outcomes The learning outcomes are as follows: to gain insight into the importance of location, in terms of spatial and temporal context and the capability of leadership to tune into and strategically adapt to context; to understand and explain the sharing economy and explain how the Uber business model fits into this new way of doing business; to evaluate how Uber South Africa has adapted its business model in the period of the COVID-19 crisis and discuss the nature of the business model innovations that is has made; and to understand business model for sustainability and how it differs from the general understanding of business models. Case overview/synopsis On 15 May 2020, Alon Lits, General Manager of Uber Africa was considering his dilemma of adapting their business model to the demands of COVID-19, without losing their core business model as a multi-sided technology platform business. Uber was asking their riders to stay home to ensure social distancing during the lockdown, rather than booking a ride with Uber. The question was how they could support their driver partners, while they were discouraging riders to make use of Uber. Uber had taken initiatives to create additional revenue streams for drivers. The case highlights how Alon Lits and his executive team prioritised the health and well-being of their Uber community and quickly adapted their technology to meet the evolving needs during the COVID-19 pandemic. They customised their offerings to the different needs in the seven Sub-Saharan Africa (SSA) countries in which they operated. Uber supported businesses by using the Uber-X sedan vehicles to deliver necessities like food, medicine and parcels to the frontline and poor communities. Uber globally offered their drivers in quarantine 14 days of financial assistance. Serving communities also involved offering free rides to women and children who were victims of domestic violence to get them to a safe space. The multi-sided platform technology business had to consciously adapt, to the “next normal” as the COVID-19 era evolved. Complexity academic level The case is most suitable for Post-Graduate Master’s level courses, MBA, MPhil in Corporate Strategy. Supplementary materials Teaching Notes are available for educators only. Subject code CSS: 11 Strategy.

Proposed Business Strategy for Publishing Company (Case Study: CV Gema Usaha in Solo)

CV Gema Usaha is a company running in book publishing industry, provides school books for junior high school, high school, and vocational school in Indonesia. For the past 3 years (2016-2018) the company has been suffering from some problems that affect the business sustainability. Looking from the internal perspectives, the company has high inventory, lacking in human resources, and high receivables which affect the business at CV Gema Usaha. This condition causes a value-reducing for the company. To be able to survive in the publishing industry, improvements need to be made to their business strategy. Business strategy improvement is proposed based on internal and external analysis. An evaluation of the business model currently applied is also carried out by analyzing the current business model canvas. This study uses qualitative methods using primary data and secondary data. The results of internal and external analysis produce SWOT analysis which is then used to propose strategic solutions in the form of TOWS matrix and new business model. The strategy proposed for the company is to adapt the integrated cost leadership and differentiation business strategy, and shift the publishing business model from a conventional publishing to a base on demand model, by implementing the long tail business model that is equipped with a multi-sided platform. This strategy is expected to solve the main problem of the company namely high inventories, low in cash, and limited human resources.

When Crowd-Based Resources and Capabilities Generates Radical Innovation? It Depends on the Network Effects

Peer-to-peer or digital multi-sided platform (MSP) startups have created disruptions in various industries in the past few years. In this matter, the crowds within the platform ecosystem have significant contribution for digital MSP startups’ growth. However, there are limited studies that examine the crowd-based resource and capabilities as the source of radical innovation performance since it still conducts the perspective of linear product-market supply and demand. By using network theory, this research proposal wants to examine the role of network effects toward the development of the radical innovation. The findings of PLS-SEM analysis with 70 respondents from digital MSP startups show that crowds-based resources and capabilities manifested by integrative capabilities can generate radical innovation performance through decent network effect that enables to produce high incremental innovation performance beforehand. It shows the importance interaction between digital MSP startups with the crowds for innovation purposes. Hence, the findings contribute in open innovation literatures especially in finding the contributing factors to generate radical innovation

The battle of superheroes: the rise of the knowledge platform strategy in the movie industry

PurposeOver the past years – because of the huge impact of companies such as Airbnb and Uber – the concept of the platform became extremely popular in the business world. Still, the concept of the platform has been evolving for a long time in the management field, from internal platforms (like the famous case of Sony Walkman) to industry-wide platforms (like the case of computers with external software developers), up to transaction and two or multi-sided platforms (such as Airbnb and all the companies with a similar business model). Platforms are often considered disruptors in several industries, from accommodations to mobility to entertainment. Still, the disruptors in the creative world usually deal with the way in which they distribute content (Netflix or Spotify), rather than with the content itself. The purpose of this paper is to understand if and how platforms trategies can also be used in the creative industries.Design/methodology/approachThis paper digs into the movie industry, studying the three most successful Superheroes sagas of the past two decades as follows: the Marvel Cinematic Universe (MCU), DC Comics and X-Men using a narrative approach. The three sagas are studied through network analysis to understand their “platform approach”.FindingsThe results show how platform strategies are relevant also in creative industries – defining the concept of “knowledge platform strategy” – and how they have a significant impact in terms of market performance. The MCU builds on a common knowledge through the various movies that enable the chance to rely on many of the platforms’ characteristics emerging from the literature.Research limitations/implicationsThis research extends the concept of “platforms,” relying on the three kinds of platform defined in the managerial literature and introducing the “knowledge platform strategy” for creative industries. The main contribution is related to the extension of platforms in research fields where it has not been exploited. This opens up avenues for research both from a knowledge platform and creative industries perspectives.Practical implicationsManagers, working not only in creative industries but also in industries where a common knowledge basis may be leveraged to develop new products over time, may use the concept of “knowledge platform strategy” to rethink the new development process or knowledge management from a customer perspective.Originality/valueThis study explores a mature and relevant concept – the platforms – in a new filed, the creative industries using the case of Superheroes sagas, proposing a new perspective to explain the success of MCU while proposing a new platform strategy.