Andrei Hagiu

Does @ChatGPTapp have $300B worth of network effects? Not right now - the network effects are quite weak. But they could become a lot stronger if @OpenAI turns @ChatGPTapp into a platform similar to iOS/App Store. hbr.org/2025/05/could-…

@skominers @ErikHovenkamp @marco_reuter He does not :)

@ErikHovenkamp @marco_reuter Just realized I should probably tag Andrei @theplatformguy (not sure whether Julian has a Twitter account)

Cool new paper by Andrei Hagiu and Julian Wright. They study "Platform Traps" -- situations where many users voluntarily join a platform even though almost all of them would've been better off without it. It's a dynamic collective action problem fueled by network effects. 1/n

@ErikHovenkamp @skominers Thank you @ErikHovenkamp for the nice summary and @skominers for the related papers. The Dixit paper is indeed closely related though we go quite a bit further because we have a platform setting prices to lay the trap (no price-setting in Dixit)

@skominers Nice catch! I hadn't heard of this paper, but the idea does sound quite similar.

New paper “AI and Competition Policy” forthcoming in IJIO. Will AI be dominated by a few firms? How will AI affect the market structure for existing sectors? What “traditional” competition policy issues arise with AI and what novel issues does AI raise? doi.org/10.1016/j.ijin…

Column for the Korea Herald on #GenerativeAI and competitive advantage biz.heraldcorp.com/insight/view.p…

The agenda for the premier Platform Strategy summit is posted. Pls join us July 16 to see top tier research questromworld.bu.edu/platformstrate… @ntwk_platforms @theplatformguy @AnnabelleGawer @g2parker @CarmeloCennamo @BUQuestrom @mit_ide

My new @HarvardBiz article with Julian Wright on how to evaluate defensibility and upside potential for marketplaces. Available online now, will be in the July-August magazine issue. Please share with your marketplace entrepreneur and investor friends! hbr.org/2024/07/will-t…

Miss our group chat with @theplatformguy earlier this week? This was a great chat where we did a deep dive into topics like network effects, defensibility, the impact AI will have on marketplaces, & more. The recording is now live! everythingmarketplaces.com/c/andrei-hagiu

@jsndr @falsedvmaster @thumbtack That seems like the most reasonable option indeed. The "no thanks" button... more generally, make the mechanism as simple and transparent as possible to both sides.

@theplatformguy @falsedvmaster @thumbtack Wouldn't we think it's possible to implement a button for a "no, thank you" response that does not allow you to continue negotiating with that pro, as opposed to genuine messages? Extrapolating from Airbnb, it should still be possible to limit platform-circumventing negotiations.

Used @Thumbtack to hire a plumber and realized there is a design/pricing issue that seems unfair to pros. Here is my understanding of how it works (please correct me if I'm wrong):

@falsedvmaster @thumbtack The question then is whether there is any serious downside in clearly communicating the constraint to clients? Sthg along the lines "if you want to negotiate, go ahead, but only do so if you are seriously considering the pros, otherwise you are costing them for no reason"

@falsedvmaster @thumbtack Right, so I guess my behavior isn't very common. Interesting to consider the "right" mechanism design here (assuming the platform is interested in that and not in a quick $25 on the sly). Agreed there should be some friction for pros to get refunds in order to keep them honest.

@falsedvmaster @thumbtack Still, why should the burden be placed on the pro to request a refund? Why not make it clear to the client that there is no need to reply "no thanks" as that triggers a fee to the pro?

@theplatformguy @thumbtack This sounds like an interaction from the Opportunities tab since the pro initiated. Since you said "no, thanks," the pro can request a refund in this case. This is documented at help.thumbtack.com/article/refund… under "The customer's first contact is "no thanks"" heading.

@falsedvmaster @thumbtack Thanks! That's reassuring. I thought indeed jt would be a strange oversight!

@thumbtack Again, please correct me if my understanding is incorrect.

Then a pro I didn't hire let me know that my reply cost him $25. @Thumbtack never told me that my replies would cost the pros, but did encourage me to reach out to multiple pros. That seems like blatantly misaligned incentives on their part and not fair to the pros.

Less than three weeks to vote for this (if you think the article is worthy)

This is how @Shopify differentiates from @amazon - NOT implementing full marketplace discovery Also: @owner (Shopify for restaurants, no discovery) vs. @DoorDash (full discovery), @Teachable (Shopify for online teachers, tried and abandoned discovery) vs. @Udemy (full discovery)

New paper in Management Science on how much discovery #platforms should enable. Making it easier for buyers to discover sellers leads to more transactions, but it also commoditizes sellers. So LESS discovery may sometimes be more attractive to sellers. pubsonline.informs.org/doi/10.1287/mn…