A platform business model, also called a multi-sided or two-sided platform, is an intermediary structure in which a company generates value primarily by facilitating direct interactions or transactions between two or more distinct groups of users, such as buyers and sellers or riders and drivers. The platform itself may not produce the underlying goods or services but earns money by lowering the cost of finding and transacting with the other side. Scholars did not begin treating platforms as a distinct business model until the 1990s, when sites such as Craigslist and eBay emerged. This description is adapted from Wikipedia contributors under CC BY-SA 4.0; changes were made. https://creativecommons.org/licenses/by-sa/4.0/
Facts
Partially Attested
Origin YearMarks the year Jean-Charles Rochet and Jean Tirole published 'Two-Sided Markets: A Progress Report', the paper credited with formalizing platform/two-sided-market theory in economics. Platform-shaped businesses (credit card networks, newspapers selling to readers and advertisers, early online marketplaces) predate this academic formalization by decades; this year marks the theory's origin, not the first platform business. Core MechanismThe platform earns profit by facilitating interactions between two or more distinct user groups whose combined participation generates network effects that increase the platform's value to each side. 1 Connections
Associated With
Amazon is named directly by the source article as a platform business, alongside Airbnb, Uber, Microsoft and Google.
Source Wikipedia, Platform Economy
Platform businesses, which create value by facilitating exchange between two or more customer groups, are a common vehicle for the venture founding that defines entrepreneurship.
Source Wikipedia, Platform Economy
Most gig work today is organized through digital platforms that connect independent workers directly with customers, making the gig economy a leading application of the platform business model.
Jack Ma built Alibaba as a platform connecting buyers and sellers rather than a traditional retailer holding its own inventory.
Source Jack Ma (Wikipedia)
Source Wikipedia, Larry Page
Mark Zuckerberg built Facebook as a platform connecting users, developers and advertisers rather than a single product sold outright.
Source Wikipedia, Mark Zuckerberg
A network orchestrator coordinates a network of partners and suppliers to create value without owning most of the underlying assets itself, the coordinating role a platform business model is built to perform.
Platform cooperativism proposes cooperative, worker- or user-owned governance as an alternative to the venture-funded, investor-owned platform business model.
Source Wikipedia, Sergey Brin
The sharing economy relies on a platform enabling individuals to share access to underused goods or assets, making it a specific application of the platform business model.
The source traces platform business models to scholarly attention beginning in the 1990s, the same period the technology industry's own software and internet platforms took shape.
Source Wikipedia, Platform Economy
Sources
1. Wikipedia, Two-Sided Market
WikipediaLead section
A two-sided market, also known as a two-sided network or two-sided platform, is an intermediary economic platform that connects two distinct user groups and creates value by enabling interactions between them.
Definition section
An intermediary economic platform that connects two distinct user groups and creates value by enabling interactions between them.
Theory section
The concept of two-sided markets has been developed extensively in the economics literature, particularly through the work of French economists Jean-Charles Rochet and Jean Tirole.
View the Source Wikipedia, Platform Economy
WikipediaLead section
These platforms - such as Amazon, Airbnb, Uber, Microsoft and Google - serve as intermediaries between various groups of users, enabling interactions, transactions, collaboration, and innovation.
Associated With: Entrepreneurship, Business model section
The platform business model involves generating profits by facilitating interactions between two or more distinct groups of users.
Associated With: Technology Industry, History section
It wasn't until the 1990s that scholars began to focus on platforms as a distinct business model.
View the Source Jack Ma (Wikipedia)
Wikipedia, Mark Zuckerberg
Wikipedia, Larry Page
Wikipedia, Sergey Brin
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