Geoffrey G. Parker, a Dartmouth engineering professor and co-author of the influential book 'Platform Revolution,' explores the origins and evolution of platform business models. He shares insights into the shift from expensive software to free online tools and the dynamics of two-sided markets. Parker discusses the significant impact of regulatory changes like GDPR and the rise of AI and blockchain on platforms. He also examines Tesla’s innovative charging infrastructure and the challenges traditional automakers face in adapting to the electric vehicle market.
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question_answer ANECDOTE
Twin Peaks to Platforms
Geoffrey Parker and Marshall Van Alstyne's research on platforms originated from discussions about the cancellation of Twin Peaks and ad-sponsored networks.
This led them to explore the economics of free online services during the dot-com boom, noticing things like free spreadsheets and browsers.
insights INSIGHT
Free Services and Subsidies
The rise of free online services, previously paid products, sparked curiosity about the underlying business models.
This observation led to a formal study of two-sided markets and network effects, focusing on why one side receives a subsidy.
question_answer ANECDOTE
Early Platform Research Challenges
Parker and Van Alstyne faced challenges in publishing their early platform research.
They believed in the importance of their work, despite initial skepticism, and their 2006 HBR article helped broaden understanding of two-sided markets.
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Information Rules provides a strategic guide to the network economy, exploring the economic principles governing information-based businesses. It examines the role of network effects, information asymmetry, and transaction costs in shaping market dynamics. The book offers insights into how businesses can leverage information technology to gain competitive advantage. It provides frameworks for understanding the strategic implications of information technology and the network economy. The authors' analysis remains relevant despite technological advancements.
Platform revolution
How Networked Markets Are Transforming the Economy and How to Make Them Work for You
Geoffrey Parker
This book is the first authoritative, fact-based guide on platform models. It explains how platforms connect distinct groups, creating value through network effects. The authors provide strategies for starting and running a successful platform business, identifying prime markets, monetizing networks, and adapting traditional companies to the changing marketplace. They also address issues of security, regulation, and consumer trust, and explore potential platform revolutions in healthcare, education, and energy.
Guest: Geoffrey (Geoff) G. Parker
Bio: Geoff Parker is a professor of engineering at the Thayer School at Dartmouth College and the faculty director at the Irving Institute for Energy and Society. He was awarded the Thinkers50 digital thinking award for his work on two-sided markets and the inverted firm. He is the co-author of the influential book Platform Revolution. He received his doctorate from MIT, where he was a doctoral student alongside Marshall Van Alstyne.
Summary: In this episode, Geoff, a leading expert in platform research and co-author of Platform Revolution, discusses the origins of his work on platforms, the evolution of platform business models, and the ongoing relevance of platform thinking in today's dynamic technological and regulatory landscape. The conversation traces the journey from early observations of free online services and the formalization of two-sided markets to the strategic implications of platforms and their impact across various industries, including B2B and energy. Geoff reflects on the initial skepticism surrounding platform theory, the significant effect of Platform Revolution, and his current work exploring platform dynamics in specific sectors. The discussion also touches upon the challenges faced by established firms in transitioning to platform models and the influence of emerging technologies and regulations on the platform ecosystem.
Key Discussion Points
The genesis of platform research: Stemming from observations of ad-sponsored networks and the emergence of free online services during the dot-com boom, leading to the formal study of two-sided markets and network effects.
Early challenges in platform theory: The initial uphill battle to get foundational work on platforms published.
The evolution of platform thinking: How the understanding of platforms has been shaped by events like the dot-com bust and the rise of tech giants.
Strategic implications: The development of concepts like platform envelopment and the broader strategic considerations for businesses adopting platform models.
The impact of regulation and new technologies: The influence of regulations like GDPR and CCPA, the increasing power of platforms, and the emergence of AI and blockchain on platform strategies.
Challenges and opportunities in B2B platforms: The complexities of network effects, sales cycles, core transactions, and integration challenges in B2B contexts.
Publications & Projects Mentioned
Parker, G. G., Van Alstyne, M. W., & Choudary, S. P., (2016). Platform revolution: How networked markets are transforming the economy—and how to make them work for you. W. W. Norton & Company.
Shapiro, C., & Varian, H. R. (1999). Information rules: A strategic guide to the network economy. Harvard Business Press.
Anderson, E. G., Lopez, J., & Parker, G. G. (2022). Leveraging value creation to drive the growth of B2B platforms. Production and Operations Management, 31(8), 1–22.
Parker, G. G., & Van Alstyne, M. W. (2005). Two-sided markets. Harvard Business Review, 83(10), 1–12.
Eisenmann, T., Parker, G. G., Van Alstyne, M. W., & (2011). Platform envelopment. Strategic Management Journal, 32(12), 1270–1285.
Cabral, L., Haucap, J., Parker, G. G., Petropoulos, G., Valletti, T. Alstyne, M. (2021). The EU Digital Markets Act: A Report from a Panel of Economic Experts, European Union Joint Research Centre, Publications Office of the European Union.
Talking about Platforms 
