Market entry as a marketplace owner: when and why should you sell on your marketplace?

Rösch, Jürgen Article — Published Version Market entry as a marketplace owner: when and why should you sell on your marketplace? Journal of Business Economics Provided in Cooperation with: Springer Nature Suggested Citation: Rösch, Jürgen (2023) : Market entry as a marketplace owner: when and why should you sell on your marketplace?, Journal of Business Economics, ISSN 1861-8928, Springer, Berlin, Heidelberg, Vol. 94, Iss. 3, pp. 525-541, https://doi.org/10.1007/s11573-023-01174-4 This Version is available at: https://hdl.handle.net/10419/311868 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may be saved and copied for your personal and scholarly purposes. You are not to copy documents for public or commercial purposes, to exhibit the documents publicly, to make them publicly available on the internet, or to distribute or otherwise use the documents in public. If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by/4.0/ ORIGINAL PAPER Journal of Business Economics (2024) 94:525–541 https://doi.org/10.1007/s11573-023-01174-4 Abstract The new Digital Market Act (DMA) of the European Union imposes stricter rules on gatekeeper platforms. While this affects only a few very large platforms, the discussion surrounding the implementation of the DMA offers valuable insights into the strategic behaviors of those gatekeeper platforms. A gatekeeper platform, for example, may enter its platform as a supplier, which may hurt existing third-party suppliers and restrict fair competition on the platform. This paper flips the academic discussion on whether marketplace owners should be allowed to sell on their marketplaces. It illustrates why this behavior is profitable for gatekeepers and how marketplace owners can apply this knowledge to improve their business models. The paper identifies five situations in which becoming a supplier in one’s marketplace can be profitable, but it also proposes alternative solutions to entering the market. Keywords Digital platforms · Digital Market Act · Self-preferencing · Marketentry · Marketplaces JEL classification M21 · M30 · M13 · L26 · L15 1 Introduction Digital platforms and marketplaces1 create on-platform markets. These serve to connect business users and end consumers. The owners are responsible for wellfunctioning and liquid on-platform markets. The creators of such markets need to 1 In this paper, we use “platform” or “digital platform” for the general concept of a two-sided market. Marketplaces are a subcategory of digital platforms that create markets where third-party suppliers and Accepted: 25 July 2023 / Published online: 18 August 2023 © The Author(s) 2023 Market entry as a marketplace owner: when and why should you sell on your marketplace? JürgenRösch1 Jürgen Rösch [email protected] 1 Bauhaus-University, Albrecht-Dürer-Str. 2, 99425 Weimar, Germany 1 3 J. Rösch intervene and readjust their conditions when and where necessary as their success depends to a large extent on the quality of user interactions and transactions (e.g., Belleflamme and Peitz 2021; Choudary 2015). Therefore, participating as suppliers in their own marketplaces is common for many marketplace owners. With the European Union (EU) now regulating gatekeeper platforms, this so-called dual mode has recently received considerable attention. The Digital Market Act (DMA) aims to limit the ability of digital gatekeepers to abuse their market power (e.g., Cabral et al. 2021). The act is designed to protect consumers and (re-)establish a level playing field in digital markets within the EU. Hence, it introduces duties for gatekeeper platforms, such as giving users the right to unsubscribe as quickly as they subscribe or providing interoperable instant-messaging services, at least as a base functionality. The DMA also prohibits certain practices, such as preventing users from uninstalling preinstalled apps, imposing unfair conditions on third-party sellers, and practicing self-preferencing—that is, the practice of favoring one’s products by a platform owner who also acts as a supplier (EU, 2022). The discussion around the DMA has mainly focused on some companies’ potential abuse of market power. This may show the platform economy in a bad light. The number of gatekeeper platforms is relatively low. Only very large tech corporations (e.g., Google, Amazon, Apple, Microsoft, and Meta) and some other platforms (e.g., Airbnb and Zoom) will be directly affected by the DMA (Mariniello and Martins 2021). According to Crunchbase (Crunchbase 2023), 23,850 marketplaces have been founded between 2000 and 2022, with a peak of 2,237 new ones in 2015 and almost 4,000 since the COVID-19 pandemic started in 2020. Most of these digital platforms and marketplaces will not be regulated directly. Furthermore, the practices discussed in the DMA will not necessarily be abused by those smaller marketplaces but can be reasonable measures to manage and scale their platforms. Our paper contributes to this discussion on the DMA. However, instead of focusing on policies to regulate gatekeeper platforms, we look at the managerial implications for non-gatekeeper platforms, that is, marketplaces not affected by the DMA. We show how the economic literature can help find solutions for managing quality in the marketplace, stimulating supply, or finding new revenue sources. The paper, therefore, addresses marketplace owners and offers clear suggestions for management. It also shows that solutions other than those found in the DMA might lead to similar results. This can be achieved by sharing knowledge with third parties and implementing mechanisms whereby marketplace owners grant third-party suppliers protection from unfair competition. Doing so keeps incentives for innovations in the marketplace high. For this reason, the paper also addresses policymakers. Marketplace owners may find it difficult to decide whether to become a supplier. On the one hand, actively participating in the market brings many advantages, including higher quality, lower prices, and increased transparency for demand-side users, as will be discussed further (e.g., Etro 2021; Hagiu et al. 2022; Lee and Musolff 2021). On the other hand, the marketplace depends on satisfied third parties that provide high-quality products at low prices and bring new products to the platform. An entry by the marketplace owner increases competition for third parties and makes demand-side users meet and trade. 1 3 526 Market entry as a marketplace owner: when and why should you sell… supplying or innovating less attractive for them (e.g., Bougette et al. 2022; Hagiu et al. 2022). If third parties suffer from this market entry, they may leave the marketplace; consequently, network effects cannot be used efficiently because the value for the demand side decreases. If demand-side users also leave, it becomes even less attractive for third parties to enter. This can lead to negative self-reinforcing effects (e.g., Belleflamme and Peitz 2021.). In the next section, to answer the question of when and why a marketplace owner should consider entering the marketplace as a supplier, we discuss why regulators are concerned about what happens in marketplaces and how this relates to platform owners’ interests in managing their platforms. We then present the three regulatory measures typically put forward to prevent marketplace owners from abusing their market power and how these measures influence platform management. Based on this influence, we identify five situations in which a marketplace owner should consider becoming a supplier. We also examine alternative solutions to achieve the same goal. We then discuss the findings before concluding with final remarks on the limitations of this study and avenues for future research. 2 Regulation and platform management To deal with the question whether marketplace owners should be allowed to participate as suppliers in their marketplaces, the DMA prohibits gatekeeper platforms from engaging in self-preferencing—that is, the promotion of one’s services over those of one’s competitors (e.g., Bougette et al. 2022; Caro de Sousa 2020; EU, 2022; Padilla et al. 2020; Tirole 2020). This practice is relatively common, for example, supermarkets regularly promote their private labels (Tirole 2020). The DMA, however, considers self-preferencing intrinsically harmful (e.g., Cabral et al. 2021). The reason is that gatekeeper platforms could use their dominant position to enter and occupy profitable product categories, drive out the competition (third-party suppliers), and strengthen their already dominant market position. Antitrust legal cases against gatekeeper platforms aimed at protecting fair competition on platform markets are often tedious and lengthy. Therefore, the DMA intends to prevent behaviors such as selfpreferencing with a per se prohibition in order to avoid drawn-out lawsuits, which can be too burdensome for small, third-party sellers to maintain their businesses (e.g., Cabral et al. 2021). Behind the issue of self-preferencing is the question whether marketplace owners should be allowed to become suppliers in their marketplaces. This is a particularly interesting question because it deals with fair competition on digital platforms. Both the authorities and marketplace owners are interested in fair competition insofar as they want well-functioning on-platform competition and on-platform innovation (e.g., Belleflamme and Peitz 2021; Choudary 2015). Demand-side users benefit from competing third parties, as these lead to lower prices, broader product offerings, and potentially higher quality. However, the position of the competition authorities differs from that of the marketplace owners because the latter can potentially profit from participating in the marketplace. The owner of a marketplace possesses superior knowledge (e.g., Condorelli and Padilla 2020; Hagiu et al. 2022), which it can use to 1 3 527 J. Rösch earn extra revenue in very profitable categories, thus threatening the established business of third-party competitors (e.g., Bougette et al. 2022). Third parties may have built up a new product category on the platform; once this is successfully operating, the marketplace owner could enter it and reap the profits. Moreover, marketplace owners may use their superior knowledge to develop better products (e.g., Condorelli and Padilla 2020; Hagiu et al. 2022). This knowledge can be obtained by gathering and analyzing data generated in the marketplace. The owner can access more and better data than each participant (e.g., Condorelli and Padilla 2020; Hagiu et al. 2022; Rösch and Baccarella 2022). While each participant has access only to the data about their interactions, the marketplace owner can observe and analyze every transaction on the platform. This meta perspective allows the owner to identify trends and detect supply gaps, product categories with (excessively) high prices and (too) little competition, quality problems with existing suppliers, and typical reasons for complaints from demand-side users. With this knowledge, the marketplace owner can decide to intervene as a supplier and compete with or even crowd out others (e.g., Etro 2021; Hagiu et al. 2022; Padilla et al. 2020). While competition is worth protecting, competitors are not (e.g., Motta 2004). Third parties would always prefer to have a monopoly on a specific product category, with no competitors and without having to compete with the marketplace owner, in order to maintain prices high and make large profits. However, this is not in the interest of demand-side users, who might benefit from an entry by the owner that might lower prices and improve quality (e.g., Bougette et al. 2022; Hagiu et al. 2022; Lee and Musolff 2021). Scholars have shown that forbidding the marketplace owner from acting as a supplier does not necessarily lead to higher overall welfare (e.g., Hagiu et al. 2022; Lee and Musolff 2021). The theoretical literature on whether marketplace owners should be allowed to participate in their marketplaces aims to find the best solutions for regulating digital markets and creating a fair market environment (e.g., Bougette et al. 2022; Hagiu et al. 2022). In contrast, platform and marketplace owners are more interested in building up their businesses and finding competitive advantages (e.g., Belleflamme and Peitz 2021; Cusumano et al. 2019; Parker et al. 2016). However, marketplace owners also want to create a vivid and liquid market on their platforms where demand is reliably met and supply quickly liquidated (e.g.,Choudary 2015). The literature discusses this under the rather broad term of “platform management.” Belleflamme and Peitz (2021) define platform management as the task of actively managing the network effects found among the participants and “put[ting] in place conditions for agents to benefit the most (or suffer the least) from their common presence on the platform” (Belleflamme and Peitz 2021, p. 108). Choudary (2015) identifies three platform management measures for running a successful platform. First, platforms need to promote the creation of supply. Platforms will fail if they do not provide enough supply or if they do not provide the right quality of supply. Second, platforms will fail if the value on the demand side is not high enough because there is insufficient supply, low quality of supply, or excessively high prices. Third, if a platform does not invest enough in curation, the cost of searching on it will be too high, and participants will not find the right match. In sum, platform management is about managing liquidity and ensuring that sufficient value 1 3 528 Market entry as a marketplace owner: when and why should you sell… is created for supply and demand, that demand is reliably met, and that suppliers find buyers quickly (Choudary 2015). This also requires mechanisms for quality control, which means that the platform owner needs to separate the good participants from the bad ones and encourage active involvement from the supply side to continuously develop the offerings (Choudary 2015). Another important factor is the use of data to increase value for existing participants, bring new products and services to the platform, and tap into new markets (e.g., Belleflamme and Peitz 2021; Condorelli and Padilla 2020). 3 Regulation and marketplaces In this section, we analyze the economic literature on whether marketplace owners should be allowed to sell on their marketplaces (e.g., Anderson and Bedre-Defolie 2021; Bougette et al. 2022; Hagiu et al. 2022; Lee and Musolff 2021; Tirole 2020; Zennyo 2022). We combine this literature with the platform management perspective and show that the literature provides valuable insights into when and why it might be profitable for marketplace owners to become suppliers. Based on the previous section, we argue that a successful platform (profit maximization) needs to create sufficient supply (innovation, lack of supply gaps), make the platform interesting enough for consumers (low prices, wide choice), and lower transaction costs to bring together supply and demand in the easiest way (transparency). Doing so leads to a lively onplatform market (competition) with high liquidity and quality management. In this section, we draw on the theoretical model of Hagiu et al. (2022), who analyze three solutions to deal with the problem of gatekeeper platforms potentially abusing their market power by becoming sellers in their marketplaces. The first solution is the ban on the dual model. This is the most intrusive measure, which prohibits gatekeeper platforms from becoming suppliers in their marketplaces. The second approach is the ban on imitation. This measure is less intrusive as it allows the owner to become a supplier in their marketplace but only for products not provided by third-party suppliers. The third solution is the ban on self-preferencing. In this case, the marketplace owner can act on the platform and imitate the products of third parties but not prefer their own products (e.g., Bougette et al. 2022; Etro 2021; Hagiu et al. 2022; Padilla et al. 2020).2 3.1 Ban on the dual mode Without acting as a supplier on the platform, the marketplace owner cannot close supply gaps, compete with existing suppliers, or directly address quality issues. This complete ban mainly benefits third-party suppliers, protecting them from a potentially superior competitor. By entering the marketplace, the owner can effectively increase on-platform competition (e.g., Condorelli and Padilla 2020; Hagiu et al. 2022). However, this comes at the expense of incumbent suppliers and can affect future market entrance by third parties as well as their innovation incentives. Bring2 This section builds on the analysis of (Hagiu et al. 2022) as does the broader idea of this paper. 1 3 529 J. Rösch ing a new product to the marketplace always bears some risk for third parties. If successful, however, the third-party supplier can enjoy some on-platform market power and potentially higher prices. Unfortunately for the innovative third party, marketplace owners have an unfair competitive advantage regarding knowledge (data on all activities) and costs (no commission fee) (e.g., Condorelli and Padilla 2020; Hagiu et al. 2022; Jiang et al. 2011). Marketplace owners can observe successful third-party entries and decide to enter the new product category. Furthermore, they can directly monitor the new product’s profitability and react quickly. In sum, the threat of market entry by the marketplace owner reduces the incentives for third parties to innovate (e.g., Bougette et al. 2022; Hagiu et al. 2022). Banning the dual mode has ambiguous effects. A third-party supplier would benefit as it would be safe from efficient competition. On the contrary, demand-side users would suffer due to higher prices and potentially lower quality (e.g., Etro 2021; Hagiu et al. 2022). This could lead to lower retention as users may not find the right price and quality. The network effect might also be impacted, as the marketplace owner could not directly address high prices and potentially insufficient quality despite having the information to produce a better and cheaper product (Hagiu et al. 2022). Users might switch to another marketplace, which would harm third-party suppliers. Moreover, the marketplace might increase the commission fee to compensate for missed platform revenue (Kittaka 2020). This could lead to less product variety and lower total value for all the players (Anderson and Bedre-Defolie 2021). It is also worth mentioning that while the marketplace owner reaps some profit from their dual operation, this situation does not typically result in the complete exclusion of third parties (e.g., Bougette et al. 2022; Dewenter and Rösch 2016; Hagiu et al. 2022). In an extreme case when marketplace owners are not allowed to participate, they might decide to refrain from being a marketplace and become a third-party supplier. This can happen when it is more attractive to supply the platform than to be the platform. This also holds for platforms with strong infrastructure layers, such as smartphones, when the on-platform revenues from supplying become more attractive than those from the hardware and the platform itself (Hagiu et al. 2022; Padilla et al. 2020). This “platform-to-pipeline” case currently seems unrealistic (e.g., MIT 2022), but it points to the fact that some sort of market maker and organizer is necessary to enable businesses to operate on the platform. This role in the platform ecosystem is essential for all participants to benefit from same-side and cross-side network effects. Without it, all the parties are worse off (e.g., Armstrong 2006; Belleflamme and Peitz 2021; Evans and Schmalensee 2016). Therefore, the ban on the dual mode creates potential disadvantages for the whole marketplace. Table 1 summarizes these findings. 3.2 Ban on imitation This potential regulation allows the entrance of the marketplace owner but keeps innovation incentives for third-party suppliers high. Marketplace owners are allowed to act as suppliers but not to compete with existing third parties. Imitating an existing supplier can increase competition and lead to higher quality—for example, if the new product by the marketplace owner addresses regular complaints (e.g., Condorelli and Padilla 2020; Hagiu et al. 2022). The ban on imitation limits the mar1 3 530 Market entry as a marketplace owner: when and why should you sell… ketplace owner that wants to enter the existing product category to capture some of the profit of the existing supplier, which would also result in lower user prices. Third-party suppliers benefit from forbidding imitation as the incentive to innovate increases (remains high), and they may obtain some market power (high prices) on the platform (e.g., Hagiu et al. 2022). Limiting the options of the marketplace owner to intervene on the platform comes at a price. First, reduced competition and the lack of threat of competition for thirdTable 1 Overview of potential regulatory measures and their consequences for marketplaces and different user groups Regulatory measures Potential consequences Potential effects on Influence on platform management Demand-side users Third-party suppliers Marketplace owners Ban on dual mode • Prices may be too high • Quality may be too low • Fewer choices • May pay too much (Etro 2021; Hagiu et al. 2022) • May lead to dissatisfaction (Anderson and Bedre-Defolie 2021) • May lead to lower consumption (Hagiu et al. 2022) • May enjoy market power (Etro 2021; Hagiu et al. 2022) • May have high innovation incentives (Bougette et al. 2022; Hagiu et al. 2022) • May lead to less demand (Anderson and Bedre-Defolie 2021) • May lower retention (Etro 2021; Hagiu et al. 2022) • May lead to lost profit potential (Hagiu et al. 2022; Padilla et al. 2020) • Reduced control over quality in the marketplace • Less control of competition and liquidity in the marketplace • Unused profit potential Ban on imitation • Prices may be too high • Lower quality • Insufficient choice • May pay too much (Etro 2021; Hagiu et al. 2022) • May lead to dissatisfaction (Anderson and Bedre-Defolie 2021) • May enjoy market power (Etro 2021; Hagiu et al. 2022) • May have high innovation incentives (Bougette et al. 2022; Hagiu et al. 2022) • May lead to less demand (Anderson and Bedre-Defolie 2021) • May lead to lower retention (Etro 2021; Hagiu et al. 2022) • Reduced control over the quality in the marketplace • Less control over competition and liquidity in the marketplace • Reduced control over encouraging the creation of supply and filling supply gaps Ban on self-preferencing • Inefficient curation • Higher search costs (De Corniere and Taylor 2019; Lee and Musolff (2021) • Lower satisfaction (Lee and Musolff 2021 • May by protected from unfair ranking in the marketplace (e.g., Bougette et al. 2022; Cabral et al. 2021) • May lead to less demand (Hagiu et al. 2022) • Lower competitive advantage (Lee and Musolff 2021 • Restricted ability to create transparency and curate interactions 1 3 531 J. Rösch party suppliers lead to higher prices for demand-side users (e.g., Hagiu et al. 2022; Lee and Musolff 2021). Second, with better information about demand-side user needs, the owner could design better products. Therefore, users benefit from a ban on imitation only if third-party products are always better than those of the marketplace owner (e.g, Condorelli and Padilla 2020; Hagiu et al. 2022). Let us suppose that the owner knows that the product of an existing supplier does not fulfill the demand-side users’ needs (e.g., it breaks too soon and too often) and that users send it back because it does not meet their expectations. The marketplace owner can try to convince the third party to improve its product, or they can use their knowledge to build a superior product. In the first case, the owner can only indirectly address quality issues; in the second case, quality is entirely under their control. If the marketplace owner accepts bad quality, users will eventually choose a different marketplace, making the one in question less attractive for third-party suppliers. Again, network effects will be negatively impacted. Digital platforms, however, also have other options. Jiang et al. (2011) found that platforms may prefer not to imitate and instead earn more money with higher commission fees. In this case, the marketplace owner also benefits from higher prices, leading to higher revenues per transaction. This could even lead to the platform investing in a third party to enhance innovation (Jiang et al. 2011). Table 1 summarizes these results. 3.3 Ban on self-preferencing The third regulatory option allows the marketplace owner to enter the platform and imitate existing products but not favor their products. The drawback of this option is that it partly prevents the owner from leveraging their ability to decide how products and suppliers are presented and how search queries are answered. As marketplaces are the choice architects (e.g., Choudary 2015; Thaler and Sunstein 2008), they need to decide how search queries are answered, how the algorithms work, what results are shown at the top of the list, what default option is preselected, and how the results are presented. Each of these decisions can be, and often is, designed to influence demandside users’ choices and can be employed for self-preferencing (e.g., Bougette et al. 2022; Caro de Sousa 2020; Padilla et al. 2020; Tirole 2020). Prohibiting self-preferencing comes with some caveats. The economic literature agrees that the practice should be banned in most scenarios and that self-preferencing by companies such as Amazon impedes market entry and innovation on the platform (e.g., Bougette et al. 2022; Cabral et al. 2021). However, there is also evidence that self-preferencing might be beneficial in some cases (e.g., De Corniere and Taylor 2019). The marketplace owner can use the extra revenue to lower the commission fees for all third parties, leading to more market entry (Zennyo 2022). Lee and Musolff (2021) showed that Amazon’s self-preferencing leads to statistically significant welfare gains as consumers prefer the products that the company promotes. Hence, customers face lower transaction and search costs and enjoy higher product quality if the price increase stays small. In this case, self-preferencing can help consumers to solve the choice paradox (Schwartz 2004), which states that more choice is not always better for customers because it increases their search and decision costs. 1 3 532 Market entry as a marketplace owner: when and why should you sell… ketplaces, they are reasonable in the effort to manage the market and increase value for both supply and demand. The paper also provides valuable insights for policymakers. Most digital platforms are distant from the thresholds required to qualify as gatekeeper platforms. They also probably do not have access to the same capabilities as those of big tech companies— for example, market designers with a background in economics (e.g., Athey and Luca 2019). Therefore, an equally promising, complementary approach to regulation is to enhance the capabilities of smaller competitors and foster the growth of emerging platforms. The DMA protects smaller participants, but its goal is not to promote them. This paper has some limitations. First, the results of theoretical models may not be directly applicable to real-world problems. They can only be seen as normative guidelines for an optimal decision and how this would affect demand-side users, thirdparty suppliers, and profits in a hypothetical world with limited influencing factors. Second, the five situations examined here are not mutually exclusive; for instance, promoting competition can affect quality. Also, creating transparency typically leads to better information and, thus, to a more competitive environment (Motta 2004). However, the goal of increasing competition differs greatly from that of improving quality. Separating the various goals allows for overlapping solutions. Third, other situations exist where the marketplace owner might find it profitable to enter the market. A classic entry strategy is to act as a supplier on the platform in order to create value for demand-side users regardless of third-party involvement (e.g., Choudary 2015; Gassmann et al. 2022; Parker et al. 2016). Moreover, a platform owner may occupy valuable positions on their platform to protect network effects and generate additional data without necessarily monetizing this extra service; this is called private policy tying and is a special form of platform envelopment (e.g., Condorelli and Padilla 2020). Future studies regarding the paper’s central theme could investigate whether entering as a supplier or stimulating, for example, quality or competition are alternative strategies, or if they are more likely to complement each other. Furthermore, other DMA rules could be examined; for instance, those concerning the preinstallation of certain apps or the reuse of personal data generated in one service for another service (see e.g., Condorelli and Padilla 2020). To conclude, this paper has identified a gap between the economic research on the regulation of digital platforms and business applications. Both sides could benefit from a closer understanding and intensified exchanges—general goals of business economics. Funding Open Access funding enabled and organized by Projekt DEAL. Data availability Data sharing is not applicable in the case of this article as no datasets were generated or analyzed during the study. The number of marketplaces was derived from Crunchbase, which is not publicly available, but this data was only used to demonstrate that most marketplaces are not affected by the DMA. Ethics declarations The author declares no competing interests. 1 3 539 J. Rösch The author certifies that he has no affiliations with or involvement in any organization or entity with any financial interest or non-financial interest in the subject matter or materials discussed in this manuscript. Open Access This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article’s Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article’s Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/ licenses/by/4.0/. References Anderson SP, Bedre-Defolie Ö (2021) Hybrid platform model. CEPR Discussion Papers Armstrong M (2006) Competition in two-sided markets. 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