Platform Revolution: How Networked Markets Are Transforming the Economy―and How to Make Them Work for You

by Geoffrey G. Parker, Marshall W. Van Alstyne, Sangeet Paul Choudary

Uber. Airbnb. Amazon. Apple. PayPal. All of these companies disrupted their markets when they launched. Today they are industry leaders. What’s the secret to their success?


These cutting-edge businesses are built on platforms: two-sided markets that are revolutionizing the way we do business. Written by three of the most sought-after experts on platform businesses, Platform Revolution is the first authoritative, fact-based book on platform models. Whether platforms are connecting sellers and buyers, hosts and visitors, or drivers with people who need a ride, Geoffrey G. Parker, Marshall W. Van Alstyne, and Sangeet Paul Choudary reveal the what, how, and why of this revolution and provide the first “owner’s manual” for creating a successful platform business.


Platform Revolution teaches newcomers how to start and run a successful platform business, explaining ways to identify prime markets and monetize networks. Addressing current business leaders, the authors reveal strategies behind some of today’s up-and-coming platforms, such as Tinder and SkillShare, and explain how traditional companies can adapt in a changing marketplace. The authors also cover essential issues concerning security, regulation, and consumer trust, while examining markets that may be ripe for a platform revolution, including healthcare, education, and energy.


As digital networks increase in ubiquity, businesses that do a better job of harnessing the power of the platform will win. An indispensable guide, Platform Revolution charts out the brilliant future of platforms and reveals how they will irrevocably alter the lives and careers of millions.

Genres: Business, Nonfiction, Technology, Economics, Entrepreneurship, Management, Startup

352 pages, Paperback

First published February 22, 2016

About the author

Geoffrey Parker is a professor of engineering at Dartmouth College (effective July 2016) and has been a professor of management science at Tulane University since 1998. He is also a visiting scholar and research fellow at the MIT Initiative for the Digital Economy. Before joining academia, he held positions in engineering and finance at General Electric. He has made significant contributions to the economics of network effects as co-developer of the theory of two-sided networks. Parker's work has been supported by the Department of Energy, the National Science Foundation, and numerous corporations. Parker advises senior leaders in government and business and is a frequent speaker at conferences and industry events. He received his BS from Princeton and his MS and PhD from MIT.

Reviews

[Always Pouting · Rating 2 out of 5]

Apparently people earn money by providing a platform for people to share their own content and material, that it that is the whole book. How is that enough material to write a whole book? Like even the concept itself isn't that interesting. Department stores and supermarkets sell things other companies produce as well does that make them platforms or unique and innovative?

[Tara Brabazon · Rating 3 out of 5]

This book is superior to the Malcolm Gladwell school of publishing, taking a small and basic idea and rendering it thunderous and revolutionary through metaphors. This book, written by Parker, Van Alstyne and Choudary, describes the impact of digitization, disintermediation and reintermediation as a 'platform revolution.' Obviously - and once more - this is not a revolution. This is a change.

But the authors describe this change - through airbnb, uber, youtube and yelp - quite effectively. Most of the book is fine. It is descriptive. This description has some uses.

The book loses its focus and credibility in the final two chapters. It hits a neoliberal turn by showing that regulation is troublesome for this 'platform revolution' and should be minimized. The final chapter moves to health and education, arguing both are ripe for a 'platform revolution.' MOOCs were listed as the platform revolution that universities should grasp.

No. It is important to democracy that the standards and quality of health and education remain high. Transparency, efficiency and technological innovation are important to all industries. But life, death, learning and teaching require more than information. They require verified, rigorous and tested knowledge. Uber provides few models for these industries.

[Atila Iamarino · Rating 4 out of 5]

Um daqueles livros que ouvi e em seguida incorporei no que falo ou discuto. Uma revisão excelente do que são plataformas e porque elas tomaram conta de várias indústrias (Amazon, Apple, Google, etc.). Um pouco mais técnico do que biográfico, é um livro de princípios por trás do que torna algumas áreas mais suscetíveis a plataformas, o que elas exploram e porque crescem tão mais rapidamente do que indústrias tradicionais. Excelente para quem curte internet e tecnologia.

[Wendy Liu · Rating 2 out of 5]

I almost feel guilty giving this a review since I'm deliberately reading it critically (for my dissertation), as I'm definitely not the intended audience. It's very much a business how-to catering to managers & would-be entrepeneurs/investors. There are some decent case studies and there's even a bit of criticism of the business models of some of the new tech platforms, but it's almost wholly devoid of any actual analysis beyond a superficial level. No critical engagement with the political assumptions underpinning the environment on which the platforms have emerged. "Regulatory capture" is described most often in the context of the "traditional" industries which the new platforms have disrupted - e.g., the taxi industry not wanting Uber/Lyft to operate in their jurisdiction. Of course, no attention is paid as to whether the entire regulatory system has been "captured" by a particular set of interests in the first place.

If you read this and you're unconvinced by the authors' worship of private corporations & how amazing it is that they're accumulating more and more power at the expense of actual human beings, try Platform Capitalism.

[Cam Cam · Rating 5 out of 5]

4.5/5, vì nhiều đoạn hơi lậm ví dụ so với nhu cầu của mình, nhưng đổi lại có nhiều growth case study cho người làm marketing..

Quyển Platform Scale cùng tác giả và phát hành trước 1 năm thì it ví dụ hơn, rành mạch hơn (toàn bullet points) nhưng đổi lại thì technical hơn và đọc không mượt bằng, giống kiểu guidebook. Cuốn này hợp cho CEO muốn phát triển business model.

----
Summary:
Phần giải quyết vấn đềcon gà-quả trứng khi launching a new platform (users first hay producers first) is exactly on point:
- Chiến lược follow-the-rabbit: hoạt động như pipeline business để thu hút users trước, khi có đủ users thì mở rộng thành platform kêu gọi producers. (Eg: Amazon trước là online merchant sau mở rộng thành marketplace)
- Chiến lược single-side: hoạt động như pipeline business để thu hút producers trước, khi có đủ producers thì mở rộng thành platform kêu gọi users (Eg: OpenTable trước là phần mềm quản lý booking nhà hàng, sau mở rộng thành dịch vụ booking nhà hàng)
- Chiến lược piggyback: target tới users của một platform khác đã phổ biến (Eg: Paypal phát triển như là phương tiện thanh toán chính trên Ebay, Youtube phát triển content tới người dùng Myspace,)
- Chiến lược seeding: chủ động tạo ra các value unit thu hút user trước: "mồi" làm các producer đầu tiên, hoặc trao thưởng cho các producer (Eg: Google mở cuộc thi phát triển app trên CH Play cho developers, Quora editors tự tạo và trả lời câu hỏi)
- Chiến lược producer envagelism: cung cấp nền tảng để hỗ trợ producers, producers tự động kêu gọi users (Eg: Udemy giúp giáo viên dễ dàng thiết kế khóa học online, giáo viên sẽ tự quảng bá lớp học; Kickstarter)
- Chiến lược micromarket: target tới một nhóm users ngách trước khi mở rộng (Eg: Facebook bắt đầu từ Cộng đồng Havard - target theo địa lý, StackExchange bắt đầu với programming và mở rộng sang các chủ đề khác)
- Chiến lược big bang adoption: quảng cáo bùng nổ (Eg: Twitter launching kèm trong một sự kiện lớn, là đơn vị online media cho sự kiện)

[د.أمجد الجنباز · Rating 5 out of 5]

يشرح الكتاب مل ماتريد ان تعرفه لتبني منصة ناجحة. الكتاب احترافي وعميق، وبذلك فهو يقدم معلومات قوية جدا في المجال.

ملاحظة: المنصة هي الاعمال التي تحوي واجهة تجمع بين العملاء ومقدمي الخدمة.
مثل فيسبوك وسوق دوت كوم ولنكدان وحتى جودريدز

[Robson Castilho · Rating 4 out of 5]

Ótimo overview sobre o negócio de plataformas, o livro explica muito bem sobre o assunto, contrastando com o negócio tradicional (pipeline), mostrando os impactos causados na economia e os desafios relacionados. Gostei bastante!

[Marks54 · Rating 3 out of 5]

Parker and two colleagues have produced a readable trade book on the "platform revolution" focusing on how a set of Internet firms that digitally match buyers and sellers in a variety of information intensive industries. What industries do I mean? Think of Uber, Air BnB, Alibaba, Amazon, Facebook, and a bunch of others seeking to emulate these sites ("become the Uber of industry X" - the most recent I heard of was a service linking dog walkers with dog owners in need of care). All of the authors have academic/consultant backgrounds and their book is intended for those seeking to start, invest in, work for, or others interact with these new businesses.

The basic story is clear enough and covered in the various chapters. Platforms are complex sets of programs that provide new solutions of traditional market inefficiencies or regulatory problems. What makes them especially noteworthy is their reliance of "network externalities" -- meaning that platforms become disproportionately valuable to everyone involved as large number of users (both buyers, sellers, and related parties) are attracted to the site. Basic principles of designing networks are covered as are their disruptive effects. A variety of issues related to the growing of platforms are covered in subsequent chapters and approaches are discussed for building platforms to reach critical mass. There are interesting chapters on monetizing platform activities, achieving the right amount of openness in the growth of the platform, and governing the activities of the platform as it relates to its varied stakeholders. Chapters on metrics, strategy, and regulatory policy finish up the book.

Overall, it was good, but not great. I think the authors end up taking a defensible position and backing it up with some arguments and a number of interesting cases. The Evans/Schmalensee book "The Matchmakers" was in my opinion a superior book that overlapped this book on a number of topics. This was a worthwhile read, however, and makes some good points.

What didn't I like about this book? Why give it only a 3?

I found the style and tone of the book irritating and even annoying in spots. It is clearly written in the style of a high tech business trade book where you sense that the authors are pushing their consulting credentials as much as informing you about the subject matter. In writing style, there are short punchy sentences that include lots of long multi-syllable noun-like words ending in "tion". This consultant bureaucratese just comes across as lazy writing or incomplete editing. The prevalence of battle terminology ("dominating", "crushing") is a bit over the top and seems like script discards from the current season of "Silicon Valley".

Some of the chapters were more interesting than others. For example, the design chapter used a lot of material from Baldwin and Clark's work on "Design Rules". This is a very good book for understanding modularity - which is relevant here - but it is hardly new or specific to platforms.

The chapter on monetization was also frustrating. Much was made about all of the value created by various platform sites, but little was said about charging for it. I get this - up to a point - but the question quickly arises about how valuable something really is if your customers are not willing to pay you anything for it. After all, if it does not make money it becomes a hobby right? I understand Tirole's work but in a trade book, the audience would seem to be less interested in the dropping of Nobel winning names and more interested in running a successful business.

This brings up governance and ethical issues, which are also covered. A nagging fear about these businesses is that the "business model" does not really hold up and that the key move is tied to the successful IPO, when the developers and key investors can cash out and leave the employees, smaller investors, and various stakeholders holding the bag. While it is clear that the authors really like platform firms, their discussion of ethical and regulatory issues is OK, all things considered. I was turned off, however, by the last chapter which seemed to go right back into internet boosterism with suggestions that the next industries for new dominant platforms are health care and education. Perhaps, but arguing this effectively will require much more than a summary look to tomorrow.

If one is into these businesses, then this is not a bad read. It is OK.

[Akshith Rao · Rating 4 out of 5]

This book benefits from the extensive experience of authors in the platform space. It does a great job of connecting a few landmark academic papers to observations on the ground. This book is a must read if you need to answer any of these
a) Which industries are conducive for the rise of platforms? How do they create disruptions as compared to regular incumbents?
b) Architecture, growth and monetisation mechanisms employed by platforms
c) Governance and metrics tips for platform managers

With so much public discourse surrounding platform regulation and harmful effects of monopolistic platforms, it would have been great if the authors spent more time on these aspects.

All in all a good read. Will definitely recommend it.

[Vaastray · Rating 3 out of 5]

خیلی از کتاب هایی که توی زمینه ی بازاریابی دیجیتال میخونم ناامید میشم واقعا! عنوان کتاب انقلاب شبکه های اجتماعی هست( به ترجمه ی فرسی) شبکه های اجتماعی social network یا social media در نظر گرفته میشه
تفسیر من از عنوان کتاب و نقدهای پشت کتاب این بود که کتاب داره در مورد تاثیر شبکه های اجتماعی ای مثل توییتر، اینستاگرام و ... و تاثیرشون در کسب و کارها صحبت میکنه که به کار هر بازاریاب دیجیتالی میاد اما این کتاب بیشتر برای توسعه دهندگان اپلیکیشن و کسانی که میخوان کسب و کار سنتیشون رو به سمت اینترنتی و انلاین پیش ببرند خوبه :)

حالا واقعا نمیدونم از دست خودم شاکی باشم یا از دست مترجم با انتخاب عنوان گول زننده!

[Arthur Kosten · Rating 4 out of 5]

Lots of good stuff. The authors clearly know a lot about platforms. But not easy reading. A lot of information, and despite the great content i've put the book aside for months because it isn't very exciting reading. Highly recommended for tech entrepreneurs who are running platforms or marketplaces. Almost certainly you'll pick up some great insights from the world of Uber, Airbnb, Google, Facebook and others. 5 stars for the content. 3 stars for the writing style.

[Sten Tamkivi · Rating 4 out of 5]

Good intro to someone trying to understand how software powered network effects create different business dynamics from old school service business with controlled supply chains. Or a structured, well researched reference for those who have not known business any other way.

[Herval Freire · Rating 1 out of 5]

The book is basically a two-slide powerpoint, converted into 300 pages of obvious concepts and repeating descriptions of the same things. All there is to know (if anything) is on the “takeway from the chapter” boxes.

[Karen Chung · Rating 4 out of 5]

It's a bit long, but it's full of useful information and food for thought, especially if you're working on a startup.

[Ayepyae Phyo · Rating 4 out of 5]

Very insightful and thorough analysis of platform based companies covering every important topics from strategy, labour management to corporate governance. Such an interesting read!

[Lea Elleskov · Rating 1 out of 5]

Er faktisk ik færdig med den ægte… men er færdig med den mentalt. Hader den udelukkende fordi den var til skolen 🫠

[Abigail · Rating 1 out of 5]

I'm counting this as read because of how thoroughly I skimmed this while I was stuck on the bus. I did not enjoy this experience.

[Sebastian Gebski · Rating 4 out of 5]

Decent. If you approach it with reasonable expectations, I mean.

1. It's not a vault of ideas for future platforms, but hopefully you're not that naive to think so ;D
2. This book is very academic - thorough & well-structured in terms of dissecting idea of platform as such. IMHO it's a HUGE pro: I truly appreciate approaching concept of platform from so many different angles
3. There are tons of real-life examples & cases - shallow enough to make following easy & deep enough to illustrate what has to be illustrated
4. It's very well written - not a short read, but still doesn't tire & remains enjoyable. I had no doubt that the content is useful (interesting, applicable) at any moment while reading.

Wrapping up: it didn't rock my world or forced "wow!" to let through my throat, but it's clearly a read I can recommend to someone interested in the concept of service platforms.

[Dominic Wörner · Rating 5 out of 5]

Timely book that discusses various aspects of platform businesses drawing from academic research (mostly performed by the authors themselves) and anecdotal case studies.
There is an extensive discussion about various aspects a successful platform business has to consider. From network effects (demand economics of scale) over Monetization strategies to Governance and Policy.

I really enjoyed this book and have only two minor negative points.
1) Most research that is cited is located in the Boston Area (Harvard/MIT/BU/Darthmouth). I'm wondering if the rest of the world hasn't really contributed anything.
2) The last chapter discussing the future areas of platform disruption is not of the same quality as the rest of the book.

[Ahmad hosseini · Rating 5 out of 5]

“A platform is a business based on enabling value-creating interactions between external producers and consumers. The platform provides an open, participative infrastructure for these interactions and sets governance conditions for them.”
The book addresses the designing, launching, managing, and governing a platforms. Network effects, strategy, metrics, policies, regulatory challenges, and difference between old businesses with platforms are some topics of this book. There are good examples of big platforms like Facebook, Google, Apple, and etc.
“If running a platform business is not for you, you will learn how the growing impact of platforms is likely to affect you as a businessperson, a professional, a consumer, and a citizen.”

[Otavio Furlan · Rating 5 out of 5]

What Google/Amazon/Airbnb and Nespresso have in common? They are all platform businesses! This book clarifies what makes these companies so unique and shows how network effects are so powerful in creating value for all and how technology supports the build of scalable business. A must-read!

[Tomas · Rating 4 out of 5]

The book is a must for the ones interested in economy of platforms: the history, current situation (a bit outdated already in 2020, but principles are still valid) and future perspective (basically now). The book is rich with examples and valuable argumentation.

[JJ Khodadadi · Rating 4 out of 5]

انقلاب پلتفرم!
همونطور که از نام کتاب مشخص هست مربوط به تغییرات بزرگ یا انقلابی هست که در پلتفرم های مختلفی که امروزه از بسیاری از اونها استفاده میکنیم است. تاریخچه ای از بزرگترین پلتفرم ها و توضیحاتی دررابطه با ایجاد پلتفرمهای ماندگار و موردپسند

[Sampada Nayak · Rating 5 out of 5]

This one is a really good read !

For those who are curious and intrigued by how , when , where and how the platforms like Amazon , Uber , Apple etc have taken over our world this book is a delight .. The authors start right from basic principles governing design of platforms , get you educated on "platform thinking " and "platform lingo " eventually moving on to launch , monetization and a detailed discussion on governance of platforms.. The narration does get a little textbooky and this not a book that can be read in one sitting ..Take your time to go through the chapters... The best part is explaining of concepts /principles with real life examples from platforms that we use everyday ..It even highlights "things that went wrong " with platforms in quite a few cases .. If you are anyway connected to designing , selling or improving platforms this book will have some good take-aways for you ..The last chapter on future of platforms gives great food for thought for platform designers and users both alike..

[Sean Ruff · Rating 3 out of 5]

Picked this up over a few weeks, inspired by a consulting project that had me spelunking into the world of platform strategy. Some of the case studies feel like they’re wearing skinny jeans in 2025, but the core ideas—network effects, timing, and monetization—are still timeless.

The writing style felt business-school-meets-TED-Talk: clean, smart, occasionally a bit too proud of itself. The first half delivers genuine insights on what makes platforms hum (timing, monetization strategy, network effects); the second half feels like that keynote speaker who doesn’t realize their mic is still on.

Still, if you’re building or advising any kind of marketplace, this is a worthwhile read. Just pace yourself, and don’t be afraid to bail when the flywheel metaphors start spinning in circles.

[Ricardo Figueiredo · Rating 5 out of 5]

The authors reflect on the importance of platform business nowadays. It is a pragmatic and factual view about the main differences between the pipeline type of business and this "new" platform.
It refers to the main steps to build a successful platform while analyzing some of the industry's best practices. For me, it was also important to read the author's opinion about the future and how this new approach can impact business such as health, education, and politics while giving alerts about the need to stimulate a new approach to regulation.

[Matej yangwao · Rating 4 out of 5]

Building new marketplace for X? You'll probably value this book, great overview what's needs to be done.

Learned about bootstrapping strategies, like follow the rabbit, piggyback and seeding.

≥This business format creates and exchanges value by using technology to design an ecosystem where organizations, people, and resources can smoothly interact.

≥The conventional business model is a linear value chain that operates basically like a pipeline. It facilitates the transfer of value from producers on one end to the consumers on the other end. A platform business, however, promotes value-creating interactions between users and external producers.

≥Companies are dropping the conventional linear value chain and adopting the matrix of a platform.

≥Platform businesses achieve exponential growth through a virtuous feedback loop known as network effects

≥Companies were able to gain market power, increase productivity, and crush competitors by boosting their production efficiencies.

≥Suppose a company wants to dominate a market sector. In that case, it simply gives itself a cost advantage by finding means to reduce the unit cost of manufacturing its goods or services as the quantities produced increase.

≥The low cost of doing business gives the company a competitive advantage by allowing it to reduce prices. The attractive prices on products drive sales, permitting the company to increase its production volume further, resulting in even lower prices. Once a firm puts itself in this virtuous loop, it monopolizes the market and leaves its competitors with very little chance of survival.

≥Supply-oriented economies are driven by production efficiencies, while demand-oriented economies are driven by network effects.


≥Greater value attracts more participants, which creates even more value.

≥Positive network effects are the major source of value creation and competitive advantage in a platform business.

≥In essence, any company that wants to grow in the Internet economy must learn to leverage the “demand economies of scale” by achieving a positive network effect. That is, such a firm must create a large, well-managed platform that will produce significant value for each of the participants on the platform.

≥Platforms are designed one interaction at a time.


≥Thus, in order to deliver the best experience, a platform should be designed to ensure an easy transition from role to role.

≥The value unit. The creation of a value unit by the producer on a platform is the most essential element of its core interaction. Users must be given a basis for deciding whether or not they want to engage in an exchange.

≥There are three key components of the core interaction:
• The participants
• The value unit
• The filter

≥The filter. A filter is an algorithm incorporated into the platform to enable the exchange of appropriate value units between participants. Selected users are served the value units based on filters. This ensures that consumers don’t get bombarded with units they find irrelevant and valueless, which may drive them away from the platform.

≥The first and most important thing to do when designing a platform is to specify its core interaction. The second step is to define the participants, the value units, and the filters to bring such core interactions into fruition.

≥What can a platform designer do to ensure that there is a continuous occurrence of valuable core interactions drawing more and more participants to the platform?

≥A platform must be able to carry out three important functions to make core interactions easy, inevitable, and highly valuable:
• Pull
• Facilitate
• Match

≥By analyzing user activity, this program “learns” the interests and preferences of each participant and gives out highly accurate recommendations of value units. This ensures that users keep coming back to the platform; the more they return, the more the algorithm learns about them, and the more valuable the recommendations they get.

≥Facilitate. Once there are buyers and sellers, the platform must facilitate their interactions by providing them with an infrastructure and a set of rules that make it easy to connect and make valuable exchanges.

≥Match. The platform must create efficiencies by matching producers and consumers effectively. This can be done by using information about each group to connect them in ways they’ll both find rewarding.

≥Effective platform design is all about creating systems that can pull users, facilitate interactions, and match participants to ensure a satisfactory exchange of value.

≥New platforms can boost their adoptions by riding on the growth waves of established platform businesses.

≥Dating services kickstart their platforms by creating fake profiles and conversations. To attract men, they rig the system to showcase the profiles of attractive women. When users visit and see the level of activities, they are motivated to stay.

≥The inherent value of a platform business lies chiefly in the network effects it creates. But monetizing network effects poses a unique challenge.

≥One way to monetize the value created on your platform without alienating the participants is to charge a transaction fee.

≥As a platform owner or manager, you must try out different fee levels and come up with something justifiable by the value created.

≥To monetize a platform without driving users away, charge a fee that captures a fair percentage of the value units participants enjoy.

[Alejandro Serna · Rating 5 out of 5]

Me gustó muchísimo pues llegué a este libro buscando temas de plataformas y redes, como resolver el problema de que fue primero, y me encontré un libro con mucho más, macroeconomía, gobierno, leyes, finanzas, mucho más de lo que esperaba. Con respecto a las plataformas,muy interesante toda la narrativa y aunque llego unos años tarde a el, pues sus ejemplos ya están "desactualizados" al punto que empresas que eran "ejemplo" para cuando salió el libro, ya no existen y es ahí donde me llevo una gran reflexión, estás plataformas generalmente crecen muy rápidamente pero también desaparecen en menos de una década o dos.

[Rick · Rating 4 out of 5]

Platform Revolution is een zeer interessant en makkelijk leesbaar boek. Het legt op een heldere manier uit hoe platformen zoals Uber, Airbnb en Amazon werken en waarom ze zo succesvol zijn. Wat ik vooral goed vond, is hoe het boek niet alleen de theorie behandelt, maar ook praktische voorbeelden geeft van hoe bedrijven kunnen profiteren van deze modellen. Het laat je echt anders nadenken over hoe bedrijven en markten functioneren in het digitale tijdperk.

[Viljami Kuosmanen · Rating 4 out of 5]

Comprehensive guide to the transformation from traditional pipeline business to online platforms. Absolutely loved the optimisim as well as the balanced view on regulation.

Especially noteworthy is the use of real life examples and not limited just to Amazon, Google, Uber and AirBnB.

4/5