MGIS 317 Lecture Notes - Lecture 8: Multihoming, Network Effect, Switching Barriers

• School: University of Calgary
• Department: Management Information Systems
• Course: MGIS 317
• Professor: Catherine Heggerud

Document Summary

Network a system of interconnected nodes (people, companies, places, or things) Platform mediated networks a system of interconnected network users: components; hardware, software, services, rules; technical standards, protocols for info exchange, policies, and contracts that govern transactions, provide; Matching heterogeneous needs with suitable transaction partners. Networks; value in plentitude (a function of the number of points) Network effects emerge if the value of the network perceived by a user depends on the number of interactions among the users of the network. Metcalfe"s law the value of a network grows with the square of growth in its user base. Approaches for internalizing externalities: side payments between users. In two-sided network, permanent subsidization of one side. One sided network homogenous users who all perform the same functions and transaction partners alternate roles (emailers send and receive, traders buy and sell)