Economics of platform: A new Business

Model

Platformonomics

Rathoud, Sameer

What do Airbnb, Snapchat, Uber all

have in common?

1. All of these are considered as

startups.

2. Having multibillion dollar valuation.

3. And the most important, none of

these companies directly create the

value that end user consumes.

They all have created a platform for different

kind of product or services, which they

doesn’t produce.

Uber doesn’t own any of the cabs its rider

uses. Airbnb doesn’t own the vacation

homes or apartments. Vine doesn’t create

any video content. Pinterest doesn’t post

any pins.

These is an enormous shift from the

traditional business models, where a

company creates a product or a service and

then sell it to its consumers.

This type of business model can be called as

sharing business model, collaborative

business model, business on network. But

overall it is about a platform for product or a

service.

And this new business model will continue to

rule for next few decades, where everybody

will be in the win-win situation, producers,

consumers, platformers.