Weaving a Two-Sided Network

Revision with unchanged content. Network platform competition such as those between Microsoft Windows and Macintosh, between Blu-ray and HD-DVD, among Nintendo, PlayStation and Xbox, and among VISA, MasterCard, American Express and Discover have long been a fascinating topic in the study of network economics and business strategy. These networks can all be characterized as two-sided, because they all need two types of participants whose value of joining the network depends on the number of participants of the other type in the same network. In this book, the author identifies conditions under which a two-sided network can overcome the so-called "chicken-and-egg" problem and achieve sustainable growth, and under what conditions competing two-sided networks can co-exist. The winning strategy of a two-sided network is not to monopolize the production and distribution of its products, but to invite more participants and distributors to foster a sustainable eco-system around its network platform. The book is addressed to researchers in network economics and strategic management, as well as to business executives and strategic planners in high-tech, financial, media and other two-sided markets.