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Unformatted text preview: markets where both sides pay for a product or service. I dentify
examples where only one side pays. Whatfactors determine who should pay? Does paying have
implications for the establishment and growth of a network effect? What might a firm do to
encourage early network growth?
5. The Apple iPhone Developer Program provides developers access to the App Store where they
can distribute their free or commercial applications to millions of iPhone and iPod touch
customers. Would the iPhone market be considered a one or two‐sided market? 6.4 How Are These Markets Different?
L E A RN I N G OBJ E C T I V E S
1. Understand how competition in markets where network effects are present differ from
competition in traditional markets.
2. Understand the reasons why it is so difficult for late‐moving, incompatible rivals to compete in
markets where a dominant, proprietary standard is present. When netwo rk ef f ects play a starring ro le, co mpetitio n in an industry can be f undamentally
dif f eren...
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- Winter '14