Platforms are a business model – a holistic description of the way a company creates, delivers, and captures value rather than simply a piece of technology. Platform business models often use modular modification, and this leads to incorrectly use of “platform” – computing platform, product platforms, industry platforms and platforms as services are all examples.
The complexity of the core transaction should be extremely low.
Commoditized industries have consistent and transparent pricing and a focus on increasing transactions.
Platforms do not equal technology; they have been around for thousands of years (bazaars)
Platforms don’t even try to guess what customers want, they simply facilitate interactions.
Platforms allow groups to exchange value amongst themselves and therefore what a company owns is less important than the resources it can connect to. They create communities and markets that allow users to interact and transact. These characteristics allow platforms to expand at a pace unprecedented in human history, able to grow exponentially rather than linearly.
Platforms are partly so powerful because they bring hidden demand and supply into the market, therefore expanding the overall pie. Many more people use Uber than ever used taxis because it has become cheaper, more convenient and faster.
Most important aspect to get right is the core transaction – the set of actions producers and consumers must complete in order to exchange value. Facilitating the core transaction is the way that platforms create value.