| Two-sided market is one of the most popular topics in industry economics for the past few years, it is made of one platform who acts as the intermediary and two kinds of agents, the agents trade with each other on the platform. Social network sites and E-malls are typical examples of two-sided markets, and the academic circles are much interested in the price competition between platforms which based on network effects and homing structure.We discuss the problems of network effects and homing structure under two actual settings respectively. We research how the co-existence of positive and negative network effects influence the price competition between two symmetrical social network sites. And then we research how different homing choices of agents influence the price competition of two asymmetric E-malls.Social network sites are typical two-sided markets, and with the profits gained from advertisers, the sites buy resources to provide service for consumers. The number of advertisers affects consumers in two sides:one is positive network effect which comes from increasing resources, the other is negative network effect with ads increasing. This paper studies the price competition when the positive and negative effects co-exist through a two-stage Nash game. The paper finds the ratio of resources to ads has an important impact on platform profit.For the homing structure, we know that homing choices of agents can be of great importance to two-sided platforms. However it is not clear how homing structure will affect platform competition. In this paper we develop a model of price competition between two asymmetric platforms. The focuses are agents’homing choice and the impact of different homing structures on platform competition. At the same time, we have given some management implications to platforms’decision makers, we tell that platform with cost disadvantage can make up for the competitive disadvantage by improving platform differences. |
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