Platform-Mediated Networks Essay

Platform-mediated  networks  include  users, whose  interactions  are  related  to  the  network  effects, including  intermediaries  who  make  available  a  platform  that  aids  users’  interactions. Such  networks  involve  a  large  and  growing  share  of  the global  economy  which  are as  different  as  video  games, postal  delivery, credit  cards, fuel  cell-powered  cars, instant  messaging, web  search, real  estate brokerage, DVDs, and  online  dating. Sixty  of  the  world’s  100  largest  companies  according  to  the current  market  value  ranked  by  market  value  are  earning  most  of  their  revenue  from  such  networks, including  American  Express, Cisco, Citigroup, Time  Warner, UPS, and  Vodafone.

Don't use plagiarized sources. Get Your Custom Essay on
Platform-Mediated Networks Essay
GET AN ESSAY WRITTEN FOR YOU FROM AS LOW AS $13/PAGE
Order Essay

In  many  platform-mediated  markets, network  effects  are  so  strong  that  a  particular  and  distinct  platform  succeeds. The  use  of  one-sided, two-sided  and  three-sided  networks  has  explored  the  new  situations  for  generating  the  profits. The  positive  and  negative  network  effects  have  paved  the  way  for  the  companies  to  lay  their  business  by  using  these  types  of  networks. This  is  very  much  evident  from  the  success  story  of  many  companies, as  evidenced  by  the  impressive  and  stunning  success  of  some  platform  providers  like  Microsoft, eBay, and  Google.

These  companies  are  showing  a  tremendous  revenue  generation  as  by  using  the  network  effect.

            According  to  Thomas  Eisenmann  the  Platform-Mediated  Networks  are  the  chief  resources  of  revenue  for  the  companies  in  today’s  era. In  the  Platform-Mediated  Networks, the  network  effect  is  used  tremendously  for  economic  growth  of  the  companies. For example in  credit  card  networks, consumers  require  a  unique account, a  plastic  card, access  to  phone-based  customer  service, a  monthly  bill, and other  resources.

Service  providers  require  workstations  and  systems  for  authorizing transactions, procedures  for  submitting  charges  and  receiving  payment, and  others. Given  these  different  requirements, platform  providers  are  serving  these requirements  for  accomplishing  the  demand. The  users  are  increasing, thus  increasing  the  profit. These  networks  are  associated  with  the  large  users. Many  economists  have  studied  the  generous  effect  of  the  Platform-Mediated  Networks.

            The  network  effects  are  strong  in  the  matching  network  when  there  are  transactions  in  business  encompass  the  heterogeneous  demands  and  supply.  The  requirements  in  today’s  era  are  accomplish  by  the  service  providers  for  the  fulfillment  of  the  user  demand.  Also  the  users  strongly  prefer  a  network  that  offers  access  to  a  wide  variety  of  platforms.  The  platforms  provide  different  types  of  facility  through  networks  like  in  some  networks,  users  have  sequential  transactions  but  require  novelty  e.g.  DVDs  or  video  games  and  some  networks  facilitate  user  mobility  like  credit  card.  Thus  the  service  providers  develop  their  infrastructure  for  these  sorts  of  requirement

            Even  for  increasing  the  revenue  the  service  providers  are  concerned  about  the  virtues  for  the  users  for  increasing  the  profit  margins. The  service  providers  have  followed  the  virtues  like  Side  Payments,  Permanent  Subsidies  in  Two-Sided  Networks  and  Subsidies  for  Early  Adopters  for  increasing  the  business.  Platform  intermediaries  sometimes  enjoy  strong  supply-related  scale  economies  because  they  require  heavy  upfront  investments  that  yield  fixed-cost  leverage.

For  example,  launching  a  new  video  game  console  entails  huge  investments  in  custom  semiconductor  design.  Likewise,  many  networked  businesses—for  example,  software  development—offer  potential  for  learning  by  doing  because  they  involve  complex,  multi-step  production  processes  that  lend  themselves  to  ongoing  improvement.

            Network  effects  are  termed  and  viewed  as  “demand-related”  instead  of  “supply-related”  scale  economies. This  is  the  reason  why  there  is  such  a  stunning  boom  in  this  market. The  companies  are  utilizing  the  resources  for  fulfilling  the  demand  of  the  user  rather  than  only  supplying  the  products. The  company  like  eBay  is  basically  working  on  this  principle  only  by  increasing  its  resources  for  empowering  the  user  with  different  facilities  for  online  transactions  i.e. purchasing  and  selling.

             Platforms  also  can  be  categorized into  four  groups  based  on  their  principal function. They  are  providing connectivity, promulgating  variety, matching, and  price setting. The  connectivity  problems  are  further  being  taken  into  consideration  by  the  providers  to resolve  the  problems  and requirements  of  the  As  with  matching  platforms, users  rely on  price-setting  platforms  to  find transaction  partners. Whereas  matching  platforms  help  users  reveal  idiosyncratic requirements  and  offers, users  in  price-setting  networks  disclose  the  price  at  which they  are  willing  to  exchange  well-defined  items.

            Even  the  platform  intermediaries  enjoy  strong  supply-related  scale  economies. Software  development  offers  potential  for  learning  and  creating  the  new  entities  for  the  user  and  by  applying  the  software  in  the  platform  mediated  networks  the  cost  also  get  decreased, increasing  the  profit  margin  in  the  business.

            eBay  is  another  example  of  a  platform. The  eBay  users  i.e. the  bidders  and  sellers  must  have  access  to  an  Internet-connected  PC  with  a  web  browser. Platform  rules  include  registration  requirements, policies  for  bidding  price  terms, dispute  resolution  procedures, and  feedback  systems  for  tracking  sellers’  trustworthiness  which  are  used  rapidly  and  frequently  by  the  user  as  the  eBay  is  working  for  generating  the  revenue  by  fulfilling  the  demands  of  the  users. The  similar  example  can  be  taken  of  the  Amazon. The  Amazon  is  also  working  tremendously  same  as  eBay  as  the  users  are  using  the  Amazon  as  a  platform  of  purchasing  and  selling  as  this  company  has  also  provided  the  demand  related  theory.

            The  speedy  growth  of  open  source  software  (e.g., Linux)  and  content  created  through  shared  user  communities  (e.g., Wikipedia)  has  generated  eagerness  concerning  the  virtues  of  open  versus  closed  network  models. Thus  even  the  article  publishing  websites  are  also  generating  the  high  revenues  through  the  Platform-Mediated  networks. Thus  the  saying  of  the  Thomas  Eisenmann  is  true  as  according  to  the  studies  and  market  analysis. The Platform-Mediated Networks are thus increasing their revenues day by day.

Reference:

1)  Platform-Mediated  Networks:  Definitions  and  Core  Concepts, 9-807-049, REV:  OCTOBER  2, 2007.

Grand Paper Writers
Order NOW For A 10% Discount!
Pages (550 words)
Approximate price: -

Our Advantages

Plagiarism Free Papers

All papers are written by the best professional writers to ensure 100% originality. We always provide plagiarism reports whenever we deliver completed papers.

Free Revisions

All papers by Grand Paper Writers are completed and submitted on time. This timely delivery of papers gives you time to go through the paper before the official deadline.

Title-page

As an additional service, we will provide a title page that precedes the contents of your paper. Here, you will provide your personal details.

Bibliography

We also ensure that we provide an extra page for the references or bibliographies following referencing rules.

Originality & Security

At Grandpaperwriters.com, we guarantee students for the provision of security and original work. All your personal information is handled with confidentiality and is not shared with third parties. Additionally, we ensure that we provide original content with accompanying plagiarism reports to show originality.

24/7 Customer Support

Our customer support team is always available 24/7 to provide instant responses to any queries raised by students.

Try it now!

Calculate the price of your order

We'll send you the first draft for approval by at
Total price:
$0.00

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

Grandpaperwriters.com has the best professional essay writers for quality services.

Pricing

Flexible Pricing

Here, a Grandpaperwriters.com, we do not compromise on the time of our clients. We always deliver all completed papers on or before the deadlines.

Communication

Admission Help & Client-Writer Contact

Grandpaperwriters.com provides an interactive portal where students can communicate directly to their writers.

Deadlines

Paper Submission

Here, a Grandpaperwriters.com, we do not compromise on the time of our clients. We always deliver all completed papers on or before the deadlines.

Reviews

Customer Feedback

Grandpaperwriters.com appreciates feedback from our clients to help us improve the delivery of essay writing services. As such, we are constantly changing our policies to ensure maximum customer and writer satisfaction.