A new research paper is now available on this site. The paper, Business Platforms: Profiting From Networks discusses network effects and how to profit from them using lessons learnt from Amazon, eBay, and others.
The paper argues that three developments are coming together at this moment in time. The first is a new understanding of the potential value of bringing together previously disconnected communities. This is enabled by new developments in social and mathematical sciences, and we present just the important results with several illustrative examples.
The second is an improved ability to connect networks easily. This is partially due to new technology developments, for example web services, but perhaps even more a result of social changes. We discuss this development briefly.
The third is an evolution of business practices to turn the potential value released by combining communities into actual profits for the business. We discuss this in some detail with examples of companies that are already making money by combining these developments. I close the paper with some figures about the current size of business platforms (well over $2 bn) and some pointers to future challenges.
The PDF version is available here: Business Platforms: Profiting From Networks.