daily articles for founders

Surviving and thriving in a two-sided market  

Here's a great analysis of two-sided markets by Des Traynor, with particular references to app.net. A taster:

Same-side network effects are those where strength of one side has an impact on its growth. It can be positive—Facebook, for example, is better with all of your friends on it, so you invite them. It can also be negative: Facebook is less attractive to advertisers when all of their competitors have already saturated the market.

Cross-side network effects are when the strength of one side has an impact on the growth of the other. They can be positive: the more readers a news website has, the more attractive it is to advertisers. And they can be negative: the more adverts a news website shows, the less attractive it is to potential readers.

Read more.

More from the library:
Formula for elevator pitches
Four pricing principles
What's the use of stories that aren't even true?
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