| With the development of Internet technology and e-commerce, online shopping is becoming a trend and more popular in our country nowadays, the third-party payment platform,which provides a credit guarantee for online buyers and sellers, has emerged to solve the problem of distrust of "pay their dues on delivery" in the online shopping, also to promote the development of e-commerce market, the scale of enterprise and personal online trading is growing. In turn, the development of e-commerce market promote a further development and the expanding scale of third-party payment market. With the rapid development of Chinese third-party payment, the third-party payment is becoming an independent non-financial institutions to complete the payment and settlement, and it becomes an important complementary part of China’s payment system.However, the third-party payment market is still in the initial exploratory stage, its rapid development revealed many problem. The third-party payment market involved in Internet technology, network economics, finance and payment and settlement and so on, is characterized with a strong network externalities. Under the effect of the economies of scale and the positive feedback, the entire market that actually occupied by one or two companies formed a strong situation of monopoly. Due to the technical barriers, other companies are difficult to enter the industry. Other third-party payment companies fight fiercely for in the rest of the market share, plus competition of online-bank, the most of the corporate make a very low earnings and even are still in loss of state. Under the conditions of the characteristics of the two-sided market, how the third-party Internet payment platform makes a reasonable price structure and develops a rational competitive strategy to attract more customers is the main purpose of this study.The third-party Internet payment has been officially entered into the regulatory stage of Chinese payment system when the payment license of the non-financial institutions was issued, government is paying more attentions to the regulation and the specification of the third-party Internet payment. This study analyzes the market situation and business model of the Chinese third-party Internet payment; and takes the theory of market structure in the industrial economics into the market concentration ratio of the Chinese third-party Internet payment and make an empirical analysis; then does an empirical test to the network externalities of the third-party Internet payment with Metcraft Law, even analyzes its characteristics of the two-sided market; finally, constructs a pricing model in two-sided market of the third-party Internet payment, under the bank’s participation, discussed the influences on platform’s profits through choosing the registration fees, the transaction fees and the bank charges on the platform, and the Chinese third-party Internet payment enterprise would choose a reasonable pricing strategy so that make this industry operate normally and develop healthily.This study is divided into five chapters:The first chapter is introduction. It has introduced the background and significance of the study about the third-party Internet payment and two-sided market, reviewed the research literature, and pointed out the idea and framework of this study, as well as the paper’s research methods and innovation.The second chapter is the introduction of the research object and the development of Chinese third-party Internet payment market, summarizes the present status of this market. And discusses the market structure of Chinese third-party payment, and make an empirical test on network externalities of Chinese third-party payment market.The third chapter is the transition of this article. It mainly introduces the theory of two-sided market and the pricing, addresses the problem through the combination of the pricing theory and the third-party Internet payment platform.The fourth chapter is the important and difficult part of this study. It innovatively takes the pricing model of the two-sided market to the Chinese third party Internet payment market, and analyzes how to price in the Chinese third party Internet payment market and how to monitor this market under the participation of the bank.The fifth chapter is the summary of this study. In this chapter, it comes to the conclusions, and give some advice about the Chinese third party Internet payment market on pricing and the regulatory. It pointed out many shortcomings and future research direction of this study.This study has come to following four conclusions and three revelations:First, the Chinese third-party Internet payment market has high relative concentration ratio. We take the conclusion that the Chinese third-party Internet payment market is highly monopolistic under analysis of relative concentration ratio index and some relative data, but exists some competitions.Second, the transaction volume of Chinese third-party Internet payment market is positively related to the square of the scale of the users, which means that Metcalfe Law is significant in Chinese third-party Internet payment market, therefore, Chinese third-party Internet payment market has the significant characteristics of the network externalities. Chinese third-party Internet payment market not only has a direct network externalities, but also has indirect externalities, this feature is a sufficient condition that the third-party Internet payment is two-sided market, which will impact the level of registration fees and transaction fees and choosing the price strategy.Third, the Chinese third-party Internet payment market has the characteristics of the two-sided market. And this market has four basic characteristics of the two-sided market: The platform has two customer base, network externalities, network externalities can be internalized, platform pricing. Platform can give a non-neutral price on both sides of the customers, and it is a creative two-sided market.Fourth, the Bank’s participation will affect the price mechanism and competition strategy choice of the third-party Internet payment. Under the conditions that banks participate, banks as the stronger bargaining party can charge higher transaction fees and thus maximize their profits, which affects the price strategy of the third-party Internet payment platform.China has formally token the third-party payment industry into the regulatory of the payment system. This study comes to three revelations:(1)The third-party Internet payment industry in China is still in its infancy, the bank still plays an important role in transferring funds of the third-party Internet payment platform. The bank can charge some fees to the platform for making profits. Therefore, the third-party Internet payment platform company should strengthen cooperation with the bank, innovate payment model, to expand the size of the market.(2) After payment license period, the third-party payment platform can be combined with the outline payment, mobile payment and pre-paid cards and other means of payment to explore more service fields like fund, insurance. This makes the third-party Internet payment companies actively explore more innovative price and profitability models, which will improve the circulation of funds and promote the development of other sectors.(3) The third-party Internet payment is expected to develop well with the regulatory policy enforced, which will increase the attentions and attractions of some investment institutions. And these institutions will invest more for this industry, which makes the flow of capital within the industry be more abundant. If the trend continues, new service innovation of the third-party Internet payment platform will impact the traditional financial operations and service delivery model, even supplement, replace or even beyond the parts of traditional financial service. |
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