Platform Competition Research Based On Duopoly Model

Through observation, we find that the competitions existing in those important industries concerning, including the internet industry, E-commerce industry, banking card industry, media industry and retailing industry, are no longer the mere competition of traditional single company or in the same industry association instead it is the competition in the whole chain of production and management. Therefore we call this the competition of "Business Ecosystem".These industries possess the same characteristics:the compound body formed with the core of platform enterprise, together with the involvement of bilateral or multilateral markets. It is not the unilateral market constituted by one kind of traditional enterprise as supplier and one kind of consumer as demander but certain kinds of bilateral or multilateral markets through which two or more kinds of consumers can exchange goods and services on the platform provided by the operators of platform enterprises.Because of its unique natures, the platform enterprises own great difference comparing with enterprises of unilateral market on competition strategies like price and investment. The traditional theory of industrial organization determines the behavior and performance by making use of market structure to divide the industry into specific patterns. In order to attract more multilateral consumers and expand trading volume, the platform enterprises often apply competition strategy like inclined pricing, unilateral subsidies, platform pricing conspiracy and product differentiation. These phenomena cannot be explained by traditional theory of economic competition. This thesis intends to construct a system for the competition of platform enterprises by analyzing characteristics of bilateral market and the competitive behavior of platform enterprises, analyze the differences of competition exists in platform business according to change of market environment so as to provide some suggestions on decision-making on competition of platform enterprise.