The Antitrust Analysis of Multisided Platform Businesses

Evans, D.; Schmalensee, Richard

doi:10.1093/oxfordhb/9780199859191.013.0018

Cited by 61 publications

(15 citation statements)

References 42 publications

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“…Multi-sided markets have been extensively analyzed in the literature. For a recent and comprehensive overview of the economics literature on multi-sided markets, see [8]. In their survey article, the authors focus on competition policy issues and provide a synopsis of the general industrial organization theory of multi-sided markets.…”

Section: Related Literaturementioning

confidence: 99%

A Dynamic Contest Model of Platform Competition in Two-Sided Markets

Grossmann

Lang

Dietl

2021

JTAER

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This paper examines the dynamic competition between platform firms in two-sided markets with network externalities. In our model, two platforms compete with each other via a contest to dominate a certain market. If one platform wins the contest, it can serve the market for a certain duration as a monopolistic platform. Our paper shows that platform firms can compensate for cost disadvantages with network effects. A head start (e.g., technological advantage) does not guarantee future success for platform firms. Network effects and cost efficiency are decisive for future success. Interestingly, higher costs of a platform can induce higher platform profits in our dynamic model. Moreover, we find that a platform’s size and profit are not necessarily positively correlated. Our model also provides new insights with respect to the underlying causes for the emergence of market dominance. The combination of technological carry-over and network effects can explain a long-lasting dominance of a platform that benefits from a head start. The necessary preconditions for this emergence are convex costs, small network effects and high carry-over.

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Section: Related Literaturementioning

confidence: 99%

A Dynamic Contest Model of Platform Competition in Two-Sided Markets

Grossmann

Lang

Dietl

2021

JTAER

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“…platform adoption and use) has been the subject of investigation of a number of studies. For example, network effects and pricing concepts have been used as theoretical lenses to study the success or failure of MSPs (Evans 2003;Evans and Schmalensee 2013;Weyl 2010). Regarding the preceding (i.e.…”

Section: Lifecycle Of An Mspmentioning

confidence: 99%

Designing a multi-sided data platform: findings from the International Data Spaces case

2019

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The paper presents the findings from a 3-year single-case study conducted in connection with the International Data Spaces (IDS) initiative. The IDS represents a multi-sided platform (MSP) for secure and trusted data exchange, which is governed by an institutionalized alliance of different stakeholder organizations. The paper delivers insights gained during the early stages of the platform's lifecycle (i.e. the platform design process). More specifically, it provides answers to three research questions, namely how alliance-driven MSPs come into existence and evolve, how different stakeholder groups use certain governance mechanisms during the platform design process, and how this process is influenced by regulatory instruments. By contrasting the case of an alliance-driven MSP with the more common approach of the keystone-driven MSP, the results of the case study suggest that different evolutionary paths can be pursued during the early stages of an MSP's lifecycle. Furthermore, the IDS initiative considers trust and data sovereignty more relevant regulatory instruments compared to pricing, for example. Finally, the study advances the body of scientific knowledge with regard to data being a boundary resource on MSPs.

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“…An important feature of many current data markets is that they occur on multisided platforms that can solve coordination problems between agents that do not interact directly (Evans and Schmalensee 2014;Rochet and Tirole 2006). Consider a large social media company that offers its platform at no direct charge to users but collects data on user activity that it sells to advertisers at a price well above cost.…”

Section: Concentration and Market Powermentioning

confidence: 99%