The Habits of Successful Platform

Platforms are online environments that take advantage of the economics of free, perfect, and instant. To be more precise, a platform can be defined “as a digital environment characterized by near-zero marginal cost of access, reproduction, and distribution”.

Based on the book "Machine Platform Crowd" written by Andrew McAfee and Erik Brynjolfsson, the characteristics of the winners in the platform battles,
  • They're early to the space. They don't have to be the first, but they had better not be so late that many potential participants have already chosen a platform and network affects have taken hold.
  • They take advantage of the economics of complementary goods whenever possible, realizing that low prices for one complement lead to increased demand for others.
  • The open up their platforms to a broad range of contributors and contributions. This variety increases total consumer surplus, especially if some of the contributions are offered to users for free, and it pushes the demand curve outward in a series of nudges.
  • While they maintain a broad rule of openness, they also curate their platforms to deliver a consistent and positive experience to participants and to minimize unpleasant surprises.