Platform Pricing in the Presence of Cross-platform Network Effects
Files
Date
2024-01-03
Authors
Contributor
Advisor
Department
Instructor
Depositor
Speaker
Researcher
Consultant
Interviewer
Narrator
Transcriber
Annotator
Journal Title
Journal ISSN
Volume Title
Publisher
Volume
Number/Issue
Starting Page
4403
Ending Page
Alternative Title
Abstract
As platform businesses are booming, different platforms are connected through multi-homing users. Thus, cross-platform network effects arise and have become a strategic concern among business practitioners. However, extant literature has largely ignored cross-platform network effects. We use a stylized model to examine the network effects through the feedback loop and the impact of cross-platform network effects on platform pricing through two levels of impact: the number of multi-homing users and service complementarity. We find that platforms charge less on both sides in the presence of cross-platform network effects when they are separately owned. Moreover, platforms charge even lower prices on both sides when services are complementary. An important caveat is that platforms are willing to sacrifice prices to attract more users when cross-platform network effects are present. We also extend our model to analyze the impact of cross-platform network effects on platform pricing when two platforms are integrated.
Description
Keywords
Electronic Marketing, multi-homing, network effects, platform pricing, two-sided markets
Citation
Extent
10 pages
Format
Geographic Location
Time Period
Related To
Proceedings of the 57th Hawaii International Conference on System Sciences
Related To (URI)
Table of Contents
Rights
Attribution-NonCommercial-NoDerivatives 4.0 International
Rights Holder
Local Contexts
Collections
Email libraryada-l@lists.hawaii.edu if you need this content in ADA-compliant format.