Editing Business model (section)

=== Platform ===
There are three elements to a successful platform business model.<ref>{{cite journal |url=http://blogs.hbr.org/cs/2013/01/three_elements_of_a_successful_platform.html |title=Three elements of a successful platform |date=January 31, 2013 |first=Sangeet Paul |last=Choudary |journal=[[Harvard Business Review]]}}</ref> The ''toolbox'' creates connection by making it easy for others to plug into the platform. This infrastructure enables interactions between participants. The ''magnet'' creates pull that attracts participants to the platform. For transaction platforms, both producers and consumers must be present to achieve critical mass. The ''matchmaker'' fosters the flow of value by making connections between [[Production (economics)|producer]]s and [[consumer]]s. Data is at the heart of successful matchmaking, and distinguishes platforms from other business models.

Chen (2009) stated that the business model has to take into account the capabilities of [[Web 2.0]], such as [[collective intelligence]], network effects, [[user-generated content]], and the possibility of self-improving systems. He suggested that the [[service industry]] such as the airline, traffic, transportation, hotel, restaurant, information and communications technology and online gaming industries will be able to benefit in adopting business models that take into account the characteristics of Web 2.0. He also emphasized that Business Model 2.0 has to take into account not just the technology effect of Web 2.0 but also the networking effect. He gave the example of the success story of [[Amazon.com|Amazon]] in making huge revenues each year by developing an open platform that supports a community of companies that re-use Amazon's on-demand commerce services.<ref>Chen, T. F. 2009. Building a platform of Business Model 2.0 to creating real business value with Web 2.0 for web information services industry. International Journal of Electronic Business Management 7 (3) 168–180.</ref>{{qn|date=February 2015}}

==== Impacts of platform business models ====
[[José van Dijck|Jose van Dijck]] (2013) identifies three main ways that media platforms choose to monetize, which mark a change from traditional business models.<ref>{{Cite book|title=The culture of connectivity : a critical history of social media|last=Dijck, José van.|date=2013|publisher=Oxford University Press|isbn=978-0-19-997079-7|location=Oxford|oclc=839305263}}</ref> One is the [[Subscription business model|subscription model]], in which platforms charge users a small monthly fee in exchange for services. She notes that the model was ill-suited for those "accustomed to free content and services", leading to a variant, the [[freemium]] model. A second method is via advertising. Arguing that traditional advertising is no longer appealing to people used to "user-generated content and social networking", she states that companies now turn to strategies of customization and personalization in [[targeted advertising]]. Eric K. Clemons (2009) asserts that consumers no longer trust most commercial messages;<ref>{{Cite journal|last=Clemons|first=Eric K.|date=2009|title=Business Models for Monetizing Internet Applications and Web Sites: Experience, Theory, and Predictions|journal=Journal of Management Information Systems|language=en|volume=26|issue=2|pages=15–41|doi=10.2753/MIS0742-1222260202|s2cid=33373266|issn=0742-1222}}</ref> Van Dijck argues platforms are able to circumvent the issue through personal recommendations from friends or [[influencers]] on social media platforms, which can serve as a more subtle form of advertisement. Finally, a third common business model is [[Data monetization|monetization of data]] and metadata generated from the use of platforms.