Talking about Platforms Platform Strategy and Business Models with Andrei Hagiu
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Jan 15, 2025 Join Andrei Hagiu, an Associate Professor at Boston University and advisor on platform business models, as he unpacks the intricate dynamics of platform strategies. He discusses the concept of platform traps, where major platforms dominate sellers, and the potential for collective action to challenge this. The conversation also highlights how blockchain technology can disrupt traditional power structures and lower transaction costs. Lastly, Hagiu examines what drives success in B2B marketplaces, revealing valuable insights for startups.
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Platform Definition
- Platforms are businesses that enable interactions between customers, like marketplaces or social networks.
- Andrei Hagiu's interest in platforms began during his PhD when the first papers on the topic emerged.
Platform Traps
- Dominant platforms can exert significant power over sellers due to strong network effects, creating a "platform trap."
- Sellers become dependent on platforms for customers, giving platforms leverage to increase fees and control interactions.
Platform Regulation
- Avoid regulating platform fees solely due to network effects giving platforms power.
- Focus on regulating specific anti-competitive actions like imposing price parity or exclusivity.